Dick Smith profits up 3.1%; RBA says interest rate cut still on the table: Midday roundup

Dick Smith has seen a 3.1% jump in profit driven by online sales in the past 12 months, with the chain reporting a net profit after tax of $43.4 million today.

The electronics retailer pursued an aggressive growth strategy during the 2015 financial year, opening 70 new stores and targeting younger customers.

Total sales in Australia are up by 10%, with shareholders to receive five cents per share in dividends next month.

Dick Smith chief executive and managing director Nick Abboud said in a statement the jump in profits is thanks to to a boost in online sales.

“We are pleased to have delivered another solid underlying profit performance in our second year as a listed company,” Abboud said.

RBA says interest rate cut still on the table

Further cuts to interest rates are still on the table, according to the minutes from Reserve Bank of Australia’s August meeting.

The RBA kept the official cash rate at 2% when it met at the start of the month. The cash rate was last cut in May by 25 basis points.

The RBA discussed the growth in Australia’s major trading partners, which is close to the long-term average, as well as the gradual recovery of the euro at the meeting.

“Domestically, economic activity had generally been more positive over recent months,” the board said.

“Very low interest rates were continuing to support growth in dwelling investment and consumption, and the further depreciation of the Australian dollar was expected to impart stimulus to the economy through stronger net exports.”

Shares up on open

Aussie shares are trading slightly higher this morning off the back of a positive showing from Wall Street overnight.

Michael McCarthy, chief market strategist at CMC Markets, said it will be interesting to see where the sharemarket goes today given the “soggy performance” of energy stocks but the strength of banking shares in the past 24 hours. 

“Day traders face a particular challenge today as positive moves in European and US share markets are offset by further falls in oil and industrial metal prices,” McCarthy said.

“The picture is further muddied by mixed US data and rising gold and silver prices. Throw in reports from 17 of the top 200 Australian companies and the finishing point for the index today is a tough call.”

The S&P/ASX200 benchmark was up 0.23%, rising 12.5 points to 5380.2 points at 11.40am AEST. On Monday, the Dow Jones closed up 67.78 points, rising 0.39% to 17,545.18 points.