FASHION-CONSCIOUS shoppers helped David Jones eke out its first quarter of sales growth in two years, but it did not impress the market, which sent the retailer's shares down more than 6 per cent to $2.41.
The department store, which launched its new online sales channel this month, reported yesterday that total sales revenue increased 0.3 per cent in the September quarter to $415.6 million.
No new stores were opened during the period so like-for-like sales were also up 0.3 per cent.
Some analysts were predicting a sales rise of up to 1 per cent from the previous first quarter when David Jones reported an 11 per cent sales decline.
Also not helping the department store was its Melbourne rival, Myer, reporting a 0.8 per cent rise in comparable store sales last week, easily beating expectations that its like-for-like sales fell during the September quarter.
''Feedback from unlisted retailers suggests that trading conditions improved in the October quarter with a modest improvement in sentiment assisted by favourable weather and a step change in fashion styles,'' said Deutsche Bank analyst Michael Simotas, ahead of the David Jones announcement.
Deutsche had forecast the department store would report flat sales for the quarter.
David Jones chief Paul Zahra said sales had continued to improve in the current quarter as it heads into the all-important Christmas and clearance sales period.
He said high-margin categories such as womenswear, menswear, beauty, accessories and shoes ''all delivered positive sales growth'', while electrical and home category goods continued to be challenging.
Mr Zahra said the designer and luxury side of its fashion business recorded double-digit growth, along with its youth offering.
''Where we're still struggling is that mainstream customer that is probably less fashion conscious and actually is not shopping as healthily as we'd like,'' Mr Zahra said.
David Jones reported that its suppliers had worn the cost of price harmonisation efforts, which has led to price decreases on certain products.
For David Jones, the price cuts have largely been offset by sales volume increases.
Commenting on the failure of the company's new online sales channel on Tuesday, Mr Zahra said it was a good learning experience for the company, which plans to launch its clearance sales online on Christmas Day when most of its physical stores are closed.
''That puts us at a great advantage compared to this time last year,'' Mr Zahra said.
Despite Tuesday's glitch he said the new site has been performing well in the weeks since its launch.
''We've only been in business for a couple of weeks, we've had double the visitors and three times the sales,'' Mr Zahra said of the new platform that integrates sales and service across all digital platforms and physical stores.