‘ Failures’ blamed for $ 476m Myer loss

MYER’S executive chairman has criticised poor decisions and competition “failures” under ex- chief executive Richard Umbers’ leadership after the department store slumped to $ 476.2 million half- year loss.

Garry Hounsell, who was appointed chairman five months ago and then executive chairman in February after Mr Umbers was ousted, said the first half was blighted by poor strategy including a failure to fight aggressive competition in the lead- up to Christmas.

The troubled retailer’s halfyear result was hammered by a more than half- billion dollar writedown on goodwill but sales continue to be a problem after a string of downgrades, falling 3 per cent in the six months to January 27. Mr Hounsell told investors yesterday he has a plan to restore the bottom line while also stressing that the company was in “caretaker mode” as it searches for a new CEO.

Mr Hounsell, previously a strong advocate of Mr Umbers’ “New Myer” turnaround strategy, which included store closures, brand overhauls and a focus on big- spending, fashion- forward professional women, did not refer to the plan by name.

“Some elements of the strategy, which targeted a new high value customer were rolled out too quickly and didn’t balance enough attention on Myer’s traditional customer base,” he said. Instead, the company will shift its focus back on its traditional shopper, with Mr Hounsell saying he has been “driving the management team to trade the business more aggressively”.

Analysts questioned whether the “traditional” Myer shopper exists any more, in a market splintered by online shopping and aggressive international retailers such as Zara.

But Mr Hounsell said the company’s database showed there were still traditional customers who wanted to shop at a big department store.