In its third trading update so far this year, Michael Hill Jewellers has provided an early idea of the damage the coronavirus is having on Australian retailing in 2020, telling investors its comparable sales for the third quarter dropped by a massive 10.4%.
This is despite sales being up 1.8% by the end of February. That tells us that the virus-induced downturn in retailing (thanks to the lockdown and social distancing rules) in March was enough to push the entire quarter’s sales sharply into the red.
Michael Hill was the first listed Australian retailer to close its doors in response to the virus, shutting all 300 locations across Australia, New Zealand and Canada and standing down 2500 staff.
Numerous others, including Mosaic Brands, Myer, and Premier Investments’ chains, hotels cafes and restaurants quickly followed suit.
Total comparable sales across all its locations fell 11.2% for the quarter, with the sharpest plunge in its Canadian stores, which fell 21.1%. Total comparable sales for the entire financial year June 30 are still up 1.5%.
But analysts expect that to change this quarter with the lockdown extended out to late June or early July.
The company’s losses for the current half and full financial year will be substantial.
