Hallenstein Glassons’ chair & chief executive laid out the turnaround of the NZX-listed retail company, how it had dealt with recent international competition and what they saw as the way forward at the company’s annual meeting in Christchurch yesterday.
Chair Warren Bell said: “A significant restructure of the Glassons product team has been completed, and since June we have begun to see an improved performance in both sales & margin. Sales in New Zealand for the new summer season to date have improved 21% over the prior period. Margin is also showing some improvement.
“During the year under review, 3 key stores in Auckland were refurbished in a new concept format. All have shown growth above the chain average and further stores will be upgraded as lease circumstances allow. On 17 November, Glassons reopened in the Christchurch central city, much to the delight of our Christchurch customer base. Glassons is well on track to deliver an improved performance for the 2017 year.”
Mr Bell announced the replacement for chief executive Graeme Popplewell, who retires at the end of this year. His replacement is Mark Goddard, who has 27 years’ international retail experience in a diverse mix of retail formats. Mr Bell said he’d worked in premium, specialty & value markets internationally and in Australia & New Zealand. His most recent position was as president & managing director of Toys ‘R Us Japan. His previous senior roles included positions at Myer, Spotlight Group & Country Road in Australia.
“Mark has a comprehensive understanding of the Australian & New Zealand apparel market and a proven history in driving growth & change. He will take up his duties during the second quarter of 2017.”
Mr Popplewell said the 2016 annual results were disappointing, “but they do not show the work that was put in to strengthen each brand, and in particular Glassons. What I can say is that the work we have put in is now bearing fruit, and results for this new season thus far are much better than last year.”
He said the new Hallensteins & Glassons store formats “are as good as you will find anywhere in the world. And they have to be. 2 months ago we faced competition from both H&M and Zara in New Zealand for the first time, when both brands opened at Sylvia Park, Auckland. To meet that competition we rebuilt our stores, and I can report performance has improved since the new competition has opened.
“Our strategy to have dominant stores in key locations in New Zealand is now complete – Auckland, Wellington, Dunedin, and now at last Christchurch. This calendar year we have invested a significant sum in our store network. It’s critical that we keep up with store reinvention. Our customers are constantly exposed to the best of the best on the internet, and our bricks & mortar stores have to meet what are increasingly high customer expectations.”
Hallensteins has been reborn over the last 4 years as Hallenstein Brothers, the company’s old name. Meanwhile, Mr Popplewell said the company’s internet sales continued to grow, increasing 33% season to date: “Currently the web accounts for almost 8% of group sales and we anticipate that proportion will continue to increase.”
Overall, sales are running 10% ahead of last year: “Gross margin is also up and the season so far is showing very strong profit growth.”
Attribution: Company release.