Christmas shopping is just about to start in full swing, but keeping in mind that the economy is still "fragile", most retailers are not too confident about making a lot of sales. Up-market Australian department store David Jones has reported something similar as well. Despite witnessing changing trends which point to a good Christmas sale, the retailer has shared that it is "cautiously confident" about the shopping season as the economy has still not recovered completely and consumer confidence is still low.

"Our company is well positioned to achieve significant profit leverage to sales growth in the next up-cycle. The signs are that things are improving and there is a bias to the upside, but the macro-economic situation is still fragile", said Chief Executive Mark McInnes.

Good cost management during the troubled times has been cited as the main reason by Mr. McInnes behind a positive outlook. In the second half of the current fiscal year, David Jones' gross profit margin reportedly hiked by around 50 points, leading the retailer to believe that a good season of shopping might just be possible this year.

"Whilst traditionally gross profit margins decline during a downturn, David Jones has delivered five basis points improvement in gross profit margins in fiscal year 2009 despite trading through the most difficult economic environment since the recession in the early 1990", shared Mr. McInnes.

Despite all the good signs, the retailer is staying on-guard and has prepared itself to witness a possible low season of sales. Christmas sales account for about a third of the firm's total annual earnings.