Mar 16, 2017
Myer half-year profit exceeds expectations, sales dip
Mar 16, 2017
Australian department store Myer recorded a half-year profit increase of 5.3 percent, despite total sales for the six month period dipping 0.6% on customer fatigue and poor a stocktake sale performance.
The Sydney-based firm said total half-year sales declined by 0.6 percent to AU$1784.6 million (US$1372.52 million). However on a comparable store basis sales were up 0.3 percent. Meanwhile, sales in the second quarter fell by 1.3 percent, down 0.5 percent on a comparable stores basis, the company said in a press release.
“Myer delivered encouraging sales around the key trading periods of Spring Racing and Christmas offset by subdued sales during the Stocktake Sale, resulting in modest comparable store sales growth for the half," said Myer chief executive, Richard Umbers.
"Our enhanced merchandise and Giftorium offer, supported by improved customer service, contributed to an encouraging pre-Christmas trading period. Sales performance during the Stocktake Sale was influenced by both our own strategy of reducing markdown dependency and the emergence of widespread discount fatigue among consumers."
Surprisingly, Myer's net profit after tax (NPAT) increased by 5.3 percent to $62.8 million, significantly higher than analyst consensus estimates of $58.7 million.
Myer added that sales in January and February were below expectations with January being the low point.
Based on the expectation "that those conditions do not return", Myer still anticipates EBITDA growth to exceed sales growth in FY2017 and increased net profit after tax over FY2016.
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