- Harvey Norman plans to open additional 52 stores in Malaysia by the end of 2028.
- The company reported 44.5% increase in aggregated sales revenue in the Malaysian market during the period 1 July 2022 to 31 October 2022.
- Shares of Harvey Norman were buzzing in the red territory since Thursday (24 November 2022) morning.
Australia retailer Harvey Norman Holdings Limited (ASX:HVN) on Thursday (24 November 2022) shared details of the proposed expansion plan in Malaysia. As reported, the company plans to increase from 28 stores to 80 stores in Malaysia by 2028.
In addition to this, today, the company has reported a 6.9% increase in aggregated sales revenue for the period 1 July 2022 to 31 October 2022.
Why is Harvey Norman expanding in the Malaysian market?
In an ASX statement, the group said it has continued to recognise substantial growth opportunities in Malaysia. The first store in Malaysia was opened in 2003, and the number has almost doubled in the past five years.
The Malaysian market has been described as “a thriving post-covid economy” by Harvey Norman.
According to ASX announcement, the projected population of Malaysia by 2028 is 36.3 million, the GDP growth rate is 6.5 – 7.0%, the median age is 30.4 years, and the average household size is four. When compared to the Australian market, the 2028 population projection is 29.2 million, and the GDP growth rate is 3.9%.
The Malaysian Expansion Plans are expected to be funded through existing cash reserves and operating cash flows, said Harvey Norman.
Retail trading update, details here
The directors of Harvey Norman have reported a 6.9% surge in aggregated sales revenue and a 6.3% increase in comparable sales over the prior corresponding period.
As reported, the aggregated sales were negatively affected by the depreciation in the Euro, UK pound and New Zealand dollar. An appreciation in Malaysian Ringgit and Singaporean dollar offset the effect.
Talking about the aggregated sales revenue across geographies, the Malaysian market recorded a 44.5% increase in total aggregated sales revenue. Australian Franchises reported an increase of 9.1%, Slovenia & Croatia recorded an increase of 3.6% and Singapore of 7.5%. The Northern Ireland market recorded the highest fall of 26.4%, and in Ireland, it fell by 7.4%.
Total aggregated sales surged by 42.9% in Malaysia, 10.6% in Slovenia & Croatia, 9.1% in Australian Franchises and 2.1% in New Zealand. It fell by 20.9% in Northern Island and 1.2% in Ireland.
Share performance of Harvey Norman
Shares of Harvey Norman were spotted trading 1.89% lower at AU$4.15 per share at 11:49 PM AEDT with a market capitalisation of AU$5.27 billion. In the past one year, the share price has dropped by 18.82%, and on a year-to-date basis, it has fallen by 17.86%. The share price has surged by 10.11% in the past five years.