Myer reports 37 percent drop in first half profit

Myer’s statutory net profit fell 36.5 per cent to 24.4 million Australian dollars in the six months ending January 25 impacted by restructuring cost, redundancies and the exit of Apple products and Country Road Group brands. First half total sales at Myer were down 3.8 percent to 1.6 billion Australian dollars, while comparable store sales rose 0.4 percent excluding Apple and Country Road group sales. Online sales during the period under review were up 25.2 percent to 168.2 million Australian dollars, now representing 10.5 percent of total sales.

Commenting on the first half trading, Myer Chief Executive Officer and Managing Director, John King, said: “This result demonstrates our continued focus on profitable sales, a disciplined management of costs and cash and strengthening the balance sheet. “Achieving growth in EBIT despite a deterioration in the operating environment during our peak trading period validates the Customer First Plan and illustrates the progress made to date. Sales were impacted by a number of factors including the continued focus on profitability, the exit of Apple and the Country Road Group brands, and a disappointing performance in womenswear.”

Myer anticipates challenging retail and virus impact to further dampen sales

The company said in a statement, before one-off costs, underlying net profit fell 4 per cent to 39.6 million Australian dollars. Before new lease accounting standard AASB 16, underlying net profit rose 0.4 per cent to $41.5 million, falling marginally short of consensus forecasts around 42 million Australian dollars, EBITDA was flat at 113.1 million Australian dollars and EBIT was up 1.2 per cent at 64.5 million Australian dollars.

“Myer anticipates the challenging macro environment will continue in the second half, and the ongoing impact of the Coronavirus on store traffic remains uncertain. We have a clear plan to address the underperformance in womenswear with new management and a strengthened design team for Myer Exclusive Brands, with improvements not anticipated until FY21. We have commenced refinancing discussions with our banking syndicate and will update the market once completed,” King added.

Picture:Facebook/Myer