AAP Finance

Nick Scali sales rattled by property slump

By AAP Newswire

Nick Scali shares have plummeted more than 15 per cent after it reported a dive in sales at its furniture outlets over the last three months.

"Monthly store traffic has been down 10-15 per cent in this period and has had a significant impact on like-for-like store sales, which are currently down 8.0 per cent year-to-date compared with the previous year," the company said in a trading update to the ASX on Tuesday.

The furniture seller blamed cautious shoppers in an uncertain property market as it issued a profit guidance of $17 million to $19 million for the six months to December 31, down from $25 million in the previous corresponding period.

Nick Scali, which had warned in August that its recent sales numbers had taken a hit, said the decline recorded during the first three months of the new financial year was also apparent in October.

"The company believes this is linked to lower general retail demand associated with the recent slowing in housing sales and renovations and a cautious consumer attitude," it said.

Nick Scali shares were down 15.42 per cent to $6.09 at 1410 AEDT.

"With lower interest rates and signs of improvement in the number of housing transactions recently, Nick Scali believes this may translate to a lift in sales in the second half," the retailer said.