Analysts expect Harvey Norman to continue discounting into next year amid weak sales results after the retailer reported a 20 per cent fall in pre-tax earnings in the three months to September.

Shares in Harvey Norman at close of trading on Tuesday were eight cents lower, or 3.69 per cent, at $2.09, its lowest point in five weeks, but above an all-time low of $1.80 on August 9.

Late on Monday, the retailer’s sales figures for the September quarter showed a 3.8 per cent drop in global sales from the previous corresponding period, to $1.48 billion.

Sales in Australia were down 2.9 per cent in the quarter and 2.8 per cent over the year.

Commonwealth Bank equities analysts said sales in all parts of the company’s global network were weak, exacerbated by unfavourable currency movements.

“The business continues to experience price deflation and intense competition,” analysts said in a statement.

“We do not expect these pressures to ease until at least CY12 (calendar year 2012)”.

The analysts remain cautious given the lack of catalysts for the stock and “continued headwinds” from deflation and tactical support.

Harvey Norman said unaudited preliminary accounts for the period indicated profit before tax and minority interests would be down 19.3 per cent in the quarter to $62.8 million.

The falls were due to the strength of the Australian dollar, price declines and intense competition.

The company closed four Clive Peeters and three Rick Hart outlets in the September quarter and opened its first store in Croatia and more stores in Australia, Slovenia, and Singapore.