Department store David Jones has reported a first quarter drop in sales of more than $50million.
For the first quarter of the 2012 financial year, July 2011 to 29 October 2011, the listed company has reported a total sales revenue of $414.3million.
Between August 1 2010 to October 30 2010 sales were $466.6million, which represents a total sales decline of 11.2 per cent for this first quarter.
Despite the dip bosses at David Jones say they are well prepared to capitalise on the 'all-important' gift giving Christmas and clearance trading periods.
They say they have made good progress in clearing excess inventory and will soon introduce a new Point of Sale system provider, costing $80million per annum, with a pilot to commence next year 2012.
Chief executive officer of David Jones, Paul Zahra, said the first quarter results are broadly in line with the guidance they provided at the time of the full year results in September.
“Whilst trading improved in October and November 2011, it continues to be negative on last year,” Zahra said. “Our customer base has been hardest hit by the wealth effect including factors such as volatility in the equity markets, the weak housing market in particular at the top end, employment uncertainty in certain white collar professional sectors and uncertainty surrounding Europe's sovereign debt crisis resulting in consumer sentiment weakening and household savings increasing.”
Zahra said the business was also adversely impacted throughout the first quarter by disruption due to the significant refurbishment of the Chadstone and Warringah stores.
The downturn in sales was felt across all categories particularly in the company's home entertainment and electrical section.
Its new 'Promise Campaign' was launched in late October and follows the launch of the new 'Was. Is. Always' David Jones brand campaign in August 2011.
The 90 new brands announced throughout the year have now been introduced into the business and are trading well, Zhara said.
Most recently the Kardashian sisters were in-store to promote their new accessories range which is one of the newer brands.