Harvey Norman profit up 60%, Shares move higher: Economy Roundup

Retail giant Harvey Norman has recorded a 60% rise in first-half profit to $158.9 million after recording just $99.3 million in the previous corresponding period.

Revenue reached $1.31 billion, with chairman Gerry Harvey saying he is pleased with the result and still intends to follow a plan of consolidation for the chain this year.

“I am pleased with our extremely solid result and we are determinedly optimistic about the remainder of the 2010 financial year,” he said in a statement.

“We maintain our strategy to control costs and gain market share. We will take advantage of any uplift in economic conditions in Ireland.”

Crown has announced a first half net profit from continuing operations of $115.3 million for the six months ending December 31, compared to a $40.9.7 million loss for the previous corresponding period.

Chief executive Rowen Craigie said that overall, the results were good. “However, it was a tale of two halves within the half,” he said in a statement.

“While we started the half strongly, our domestic casino operations were adversely impacted later in the half due to a softening of consumer confidence and a greater than expected impact of refurbishment works at the two properties.”

“Specifically, main floor table revenue was impacted by the major renovations at both Crown Melbourne and Burswood… On the other hand, we achieved strong growth in VIP commission program play to set a record half year turnover of $23.4 billion.”

Shares higher despite Wall Street losses

The Australian sharemarket has opened slightly higher today despite a negative lead from Wall Street, with overseas markets and commodity prices holding up the market.

The benchmark S&P/ASX200 index was up 19 points or 0.41% to 4613.3 at 12.00 AEST, while the Australian dollar continued its slide to US88c.

AMP shares gained 1.5% to $5.95 as Commonwealth Bank shares rose 0.3% to $53.32. NAB gained 1.8% to $25.13, while Westpac also rose 0.6% to $25.85.

ANZ shares have gained 2.7% to $22.84 after the bank announced its profit for the first four months of the financial year rose by 16% to $1.6 billion. Income growth was 8%, with cost growth at 7%.

“The outlook for the economies of Australia, New Zealand and Asia is significantly more positive than at the same point in 2009,” chief executive Mike Smith said in a statement, “The improved conditions are reflected in a more positive outlook for provisions.”

“There are, however, good reasons for caution about the outlook at this early stage of the year. We are already seeing a sovereign debt crisis in Europe and there is likely to be further volatility as the global financial crisis continues to work its way through the system.”

Energy supplier AGL Energy has recorded an 89% decline in first half net profit to $183.7 million, after recording $1.6 billion in the previous corresponding period.

Underlying net profit was 22% higher at $234.8 million, and announced an interim dividend of 29 cents, up from 26 cents.

“We are on track to meet our full-year (underlying NPAT) guidance of $390 million to $420 million and are well placed to continue to grow through a combination of organic growth and acquisitions,” it said in a statement.

QBE has recorded a $1.97 billion full-year profit, representing a 6% increase from the result reported in the previous corresponding period.

The insurance group recorded $16.6 billion in revenue, up 4%, but shares in the company dropped 6.3% to $21.55 this morning.

“The outlook for growth in our existing business and for a continuation of strong underwriting profits is positive,” chief executive Frank O’Halloran said in a statement.

“Our insurance profit compares favourably with our peers and reflects the group’s continued focus on ensuring each product and each country meets QBE’s minimum requirements for return on allocated capital.”

Fitch Ratings to hold Greece rating

Overseas, Fitch Ratings has said it expects to keep Greece’s BBB+ rating the same for the next few months, according to Reuters.

The market has been shocked by the downgrades from major credit agencies, after Greece has been struggling to handle its own financial crisis.

“It is possible, but I won’t say it is likely. I don’t expect things to go widely wrong or right in the next few months,” Pryce said.”Provided things go as we expect, we’ll leave the current rating as it is for a few months.”

“We won’t be changing our negative outlook for some time… The issue is whether we will cut (the rating) further. Right now we are not.”

In the US, Federal Reserve chairman Ben Bernanke said he was interested in how Wall Street firms such as Goldman Sachs have helped Greece arrange some deals that could have potentially disguised the sizes of the country’s deficits.

“We are looking into a number of questions related to Goldman Sachs and other companies in their derivatives arrangements with Greece,” Bernanke said when asked a question at the US Senate banking committee hearing.

“Obviously, using these instruments in a way that potentially destabilises a company or a country is counterproductive,” he said. “We’ll certainly be evaluating what we learn from the activities of the holding companies that we supervise here in the US”

Stocks fell on Wall Street due to disappointing official data. The Commerce Department said durable goods orders fell by 0.6% last month, while the number of people filing initial jobless claims continued to rise for a second consecutive week. The Dow Jones industrial average lost 74.44 points, or 0.72%, to 10,299.72.