Label in spotlight as Myer’s sales fall
shortfall in the quarter, as sluggish sales in the first half of the financial year continued.
Myer’s shift away from heavy discounting, the closure of three stores in the past nine months, severe wet weather from Cyclone Debbie and weak consumer spending also weighed on its third-quarter sales.
Chief executive Richard Umbers says Sass & Bide operates in the top end of the premium range, where trading conditions are particularly tough. However, he said Sass & Bide has an important place in Myer’s range.
“We’ve been making a number of changes to the business that gives us confidence that as the conditions improve, Sass & Bide will be in a position to benefit from that,” Mr Umbers said.
“We are monitoring it closely as it goes through the changes management is putting in place.”
In the past two years, Myer has culled a number of brands and cut its private labels to make room for what it deems as “wanted” brands, including bringing in Topshop Topman and Mimco as part of a five-year $600 million transformation plan.
Mr Umbers said it should be noted that Myer had delivered total and comparable store sales growth in five out of the past seven quarters.
He said Myer was still on track to achieve full-year earnings growth in excess of sales growth, provided weak trade experienced in the January stocktake period did not continue. Myer was focused on reducing its dependence on discounting even though this had impacted on sales, he added.
The company’s sales were flat in the first half of the fiscal year, after the January stocktake sale period offset an improved performance during the Spring racing carnival and Christmas.
The company has recently closed stores in Brookside in Brisbane and in Orange and Wollongong in NSW. Shares in Myer fell 3.5¢ to 98¢.