Another reason perhaps for the RBA wiping its brow and saying 'whew we got the rise in just in time', can be found in the confirmed fourth quarter sales figures from leading department store retailer, David Jones.
And they were strong: both on a top line basis or on a like for like (or same store) basis.
And they were also stronger than in the profit update issued on July 18.
Then the company had this to say:
"The Company's 4Q07 trading performance to date has been very strong, despite cycling a high 4Q06 base of 5.4% growth.
"Trading throughout 4Q07 Clearance (which ended on 15 July 2007) has been outstanding, delivering a 10% "like-for-like" increase on 4Q06 Clearance.
"It is anticipated that Sales for the fourth quarter (which ends on 28 July 2007) will be approximately 8% higher than 4Q06 on a like-for-like basis (LFL) and approximately 11% higher on a Total Sales basis if Sales from the new Bur wood store are included.
"Based on the strong FY07 trading performance and the Company's strong gross profit margins, the underlying FY07 PAT* Guidance is now $107.5 million – $108.9 million, an increase of 32.6% – 34.2% on FY06."
But the actual figures were better than that informed forecast.
CEO Mark McInnis said in a statement that: topline sales growth in the fourth quarter was 12.1%, to $509.4 million and on the more across all curate like-for-like basis, fourth quarter sales growth was 9.2%.That's strong in any language and the retailer said it came from "strong trading categories".
Full-year sales revenue was up 9% to $1.9837 billion, and up 8.3% like-for-like, as David Jones hit the end of the financial year with a sales bang.
"The last three weeks of July continued to trade strongly resulting in a very pleasing 4Q07 Sales performance for our Company, in particular given that we were cycling a high 4Q06 base of 5.4% and were able to deliver 9.2% Sales growth on an LFL basis over and above this," Mr McInnes said.
The July 18 sales update came in the middle of that late surge, which continued up to the end of last month.
That's probably why the Reserve Bank would feel that it snuck a rate rise into the system in time. Of course any continuation of sales growth at this level will encourage the bank to think again later this year.
The shares rose 9c to $5.38.
Mr McInnes said in a statement to the ASX that DJs was well placed to capitalise on the anticipated strong consumer sentiment expected in 2008.
"The company reiterates the FY08 PAT (profit after tax) guidance it provided on 18 July 2007, of eight per cent-13 per cent growth on its increased FY07 underlying PAT base of $107.5 million – $108.9 million …", said Mr McInnes.
Since 2003, when the department store reworked its strategy, DJs has added more than $300 million in department store sales to the core business, he said. Since 1999, sales had increased by 50%.
"This track record of sales growth coupled with customer acceptance of our home brands business model, our ability to effectively manage and trade through the retail cycle, and our ongoing cost efficiencies program … makes us confident that we are well positioned to continue to grow shareholder returns over time," Mr McInnes said.
Mr McInnes said stores across all states performed well with Victoria, Western Australia and Queensland, delivering record sales.
NSW, troubled by a slowing economy, where DJs closed its Bankstown store and opened at Burwood, had experienced "a resurgence with strong sales", he said.
