Billionaire Gerry Harvey’s retail empire has suffered a decline in annual profits as the halo begins to fall off its pandemic boom.

Harvey Norman – a retailer of home appliances, furniture and electronics – posted $811.53 million in after-tax profits for the year ended June 30 on Wednesday, down 3.6 per cent on last year’s result.

Total sales across its global portfolio of company and franchised stores fell by 1.9 per cent over the year, with Delta lockdowns in 2021 offsetting stronger trading over the first six months of 2022.

The results contrast with Harvey Norman’s chief rival JB Hi-Fi, which earlier this month posted record earnings and sales in the same period.

But Mr Harvey was nevertheless upbeat about how the retailer is going.

“Our omni-channel strategy continues to deliver,” he said in a statement.

“Our balance sheet is strong, our cash reserves are solid and we continue to maintain a low net debt to equity ratio of 10.31 per cent.

“With experienced management, we have grown our integrated retail, franchise, property and digital business across eight countries to nearly $10 billion in system sales.”

Profits excluding revaluations on Harvey Norman’s property portfolio were down 10 per cent to $673.5 million.

Harvey Norman said its Australian franchisees had grown sales 10.7 per cent (against the prior year) in the two months since July 1.

The company said those were “solid sales results” were underpinned by “low unemployment and high net [bank] deposit rates”.

Analysts said the result was good against the backdrop of lockdowns, with fresh guidance that trading has been solid since June 1 buoying confidence that rising interest rates aren’t hurting retailers too much yet.

But its relative underperformance compared to JB Hi-Fi was seen as a lingering question for investors.

“The question for us is whether it is good enough for the stock to trade higher today,” Jarden analysts said in a reaction note on Wednesday.

Investors were handed a 17.5 cent per share dividend. But that wasn’t enough to stop a 0.81 per cent fall in Harvey Norman’s share price in early Wednesday trading.