Clothing group Hallenstein Glasson Holdings at its AGM this week reported a 4 per cent increase in sales in the first 18 weeks of the financial year, compared to the same period last year, but declined to update its forecast, with the key holiday period still ahead.

Group chairman Warren Bell told shareholders the business would provide a further trading update closer to the end of January, and that it expects to see trading margins fall lower near the end of the financial year.

“The outlook for the second half of the year remains uncertain as increasing costs (such as fuel, freight, electricity etc) and the lower New Zealand and Australia dollar puts pressure on our trading margins,” Bell explained.

“We will however remain focused on improving our market share and customer experience in the New Zealand and Australia fashion apparel markets in which we operate.”

Hallenstein Glasson’s chief executive Mark Goddard added that the Australian and New Zealand retail markets are increasingly challenging markets to operate within, with consumer-facing pressure on discretionary spend hurting retailers.

“We remain focused on those things that are within our control,” Goddard said.

“Our inventory levels are well controlled. We continue to build and develop our teams, to focus and build on our customer experience and service, and to develop and deliver the best product.”

The group recently saw a 58.4 per cent increase in net profit after tax to $27.36 million for the year to August, compared to $17.27 million the previous year.

Goddard noted that a focus on fashion, speed to market and customer service was key to the strong performance, and that online sales had improved significantly due to an ongoing investment in digital – growing 63.6 per cent year over year, and representing 12.8 per cent of total turnover.