Fashion and homewares retailer Country Road has reported a disappointing full-year performance, with same-store sales falling 10.9% as the Australian retail sector continues to struggle.

Australasian sales in the year to 30 June were down 2%, while group sales rose 10.6% on last year to AUD411.7m (US$442.5m) thanks to a change in reporting South African royalty sales.

This reporting change is also expected to help lift profit before tax by 30% to 40% in the financial year, the company said, adding that strong sales in South Africa, cost savings and margin improvement have helped improve the bottom line.

"The retail outlook remains challenging and our expectations on sales remain conservative," said CEO Howard Goldberg.

"Country Road will continue its disciplined approach and focus on what it does best, creating and delivering uniquely fashionable quality products at great value whilst improving shareholder returns."

Parent Woolworths yesterday (19 July) said a double-digit surge in clothing sales in South Africa boosted its full-year revenues.