Myer has reported a $38.4 million first-half profit despite a 2.3 per cent fall in comparable sales.
The department store chain, which lost $476.2 million in the prior corresponding period on more than half a billion dollars of writedowns, says improved margins and cost management in the 26 weeks to January 26 helped lift underlying profit 3.1 per cent to $41.3 million.
“There is a strong focus across the entire business on reducing costs that do not directly benefit the customer or enhance their experience in-store or online,” chief executive John King said on Wednesday.
“We have put in place a more streamlined and accountable structure in the support office, which is delivering positive results, and we have identified numerous other cost saving opportunities across the business which may be material in future years.”
The decline in sales slowed to 1.4 per cent in the second quarter from 4.8 per cent in the first, although Myer says second-half sales will be affected by the exit of some brands and the introduction of others.
“The sales result reflects the continued strong growth in online, the enhanced execution of Christmas, more targeted and relevant marketing and improved service and store layouts,” Mr King said.
Total sales fell 2.8 per cent to $1.67 billion, with the 5.7 per cent decline from concessions the sharpest.
Sales from Myer exclusive brands, which represent the smallest slice of the department stores’ income, rose 3.7 per cent to $292.2 million.
Myer’s board survived a spill motion at its AGM in November following a second strike on executive pay.
Veteran retailer Solomon Lew has been agitating for an overhaul at the top of the troubled company since his Premier Investments became its largest shareholder in March 2017 with the purchase of a 10.77 per cent stake.
Myer shares were worth 41 cents before the start of trade, up from March 2018’s all-time low of 34.5 cents, but still about 85 per cent lower than five years ago.
MYER’S FIRST HALF
* Net profit $38.4m v $476.2m loss in pcp
* Sales down 2.8pct to $1.671b
* No interim dividend