Key Highlights

  • Reported profit before tax rose 4.9% to A$790.3 million for the year to 30 June 2026.
  • Profit after tax attributable to members rose 2.0% to A$528.5 million.
  • Property Revaluation gains of A$156.8 million supported the reported result.
  • System sales rose 3.1% to A$9.64 billion, while franchising weakened in the second half and the UK Business lost more money.

How should investors read a result in which Harvey Norman's (ASX:HVN) reported profit rose but its Australian retail momentum faded? The answer depends on which line of the accounts you focus on. The period-specific figures provide context for the company’s operating performance and execution priorities.

A three-engine business

Harvey Norman is unusual among retailers. It earns income from franchising, collecting fees and rent from independent franchisees who run its Australian stores, from company-operated overseas retail in countries including New Zealand, Singapore, Malaysia and Ireland, and from a large property portfolio that is the foundation of the group's balance sheet.

FY26 results

Reported profit before tax: A$790.29 million, up 4.9%.

Profit after tax attributable to members: A$528.46 million, up 2.0%.

EBITDA: A$1,181.95 million, up 5.0%.

Adjusted profit after tax: A$437.81 million, up 8.6%.

Final dividend: 13.0 cents, fully franked, paid 12 November 2026.

Segment performance

Franchising generated profit before tax of A$345.18 million. Segment Revenue rose 4.3% to A$1.09 billion with a 5.24% margin.

Overseas company-operated retail produced profit before tax of A$135.72 million, up 23.4%. Excluding the UK expansion, it was A$166.93 million, up 25.2%. The UK operation, with two stores, widened its loss by 33.5% to A$31.21 million.

What the trading signals suggest

Higher interest rates, cost-of-living pressure and weak sentiment are weighing on discretionary home goods spending.

The overseas question

Management plans new stores in Malaysia, Singapore and Ireland in FY27 and land Acquisition for a Croatian flagship site planned for 2028, with negotiations under way for a third UK store targeted for 2027 and a long-term aim of up to 33 UK stores. property Assets and low gearing provide capacity.

Competitive position

Harvey Norman competes with JB Hi-Fi, Bunnings, IKEA, Amazon and specialist furniture and bedding retailers. The franchise structure also means group Earnings depend on Franchisee sales and the fee and rent arrangements, so a sales slump can hit the franchising Margin quickly.

Risks and what to monitor

Australian demand: weak second-half franchisee sales and negative July comparable sales.

Margin pressure: discounting that reduced the franchising margin.

UK execution: losses that widened with further stores planned.

Regulatory and reputational matters: the pecuniary penalty excluded from adjusted profit.

Capital allocation: funding of overseas growth and new land purchases.

Upcoming developments

Watch the first-half FY27 result and any trading commentary at the annual general meeting, plus sales trends through the Black Friday and Christmas period and progress on the third UK store.

The takeaway

Harvey Norman's FY26 result looks more encouraging on adjusted measures than the second-half franchising trends suggest, while overseas growth adds both opportunity and execution risk.