Harvey Norman looks to heavens above

Gerry Harvey is banking on a little divine intervention to keep cashed-up shoppers flooding into his stores.

The co-founder and chairman of Harvey Norman is confident the heavens above will deliver, as signs emerge that consumer confidence is on the rise in 2013.

The retailer reported a 4.1 per cent jump in overall sales across Australia in January, with global sales up 3.8 per cent.

This followed six months of weak sales and falling property values, which drove down the company's net profit by 36.5 per cent to $81.9 million in the half year to December 31.

Despite the profit fall, Harvey Norman shares were up 21 cents, or 9.21 per cent, at $2.49 on Thursday as the company was more upbeat about its outlook.

Asked what he plans to do sustain the bumper sales numbers, Mr Harvey said: "Pray".

"It might have more affect than anything else," he told AAP on Thursday.

Excluding the effect of new stores and store closures, Harvey Norman's sales in the period dropped by 5.3 per cent from the previous corresponding period.

The Australian businessman couldn't pinpoint why there had been such a turnaround in overall sales the new year, but said he was encouraged by the renewed positivity.

"Consumer confidence levels have risen recently and, because of that, you've now got weekly sales in January and February exceeding last year," Mr Harvey said.

"For the first time we've got sale increases for such a long time.

"It's encouraging that you've just gone (up) two months in a row."

Less encouraging was Harvey Norman's electronics and technology categories, which the company said were "challenged" by deflationary headwinds that had affected margins.

Mr Harvey admitted the categories were causing problems but said he had no plans to get rid of them and focus solely on the retailer's homemaker products.

"We're still persevering in turning them around. We're living in hope and confidence that that'll happen," he said.

Mr Harvey said the retailer was anticipating that online sales in its technology area could account for two per cent of total sales this year, "but in the other areas it'll be next to nothing".

He said he expects margin pressures to ease as more retailers shut up shop due to tough trading conditions.

"You've had so many retailers go out of business in the last couple of years ... and there's probably more to go," he said.

Harvey Norman said it has no plans to sell any of its investment properties, despite their values falling by $31.5 million in the first half - mainly linked to three recent developments and a flooded store in Queensland.

The company closed nine stores and opened six new stores in the six months to December.

Harvey Norman declared a fully franked interim dividend of 4.5 cents per share, down from five cents for the same period in the previous year.

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