Posts Tagged ‘Myer’

MYER says online business will be profitable within two years

Wednesday, December 11th, 2013
Photo credit; Timothy H on Flickr

Photo credit; Timothy H on Flickr

The Myer department store chain says it is cautious about the year ahead, given the difficult economic environment and weak consumer sentiment, but insists its online division will start seeing a profit by 2015.

Chairman Paul McClintock said that while sales in the first quarter reflected a modest improvement in consumer sentiment following the September election, the challenging conditions have continued.

The group remained “cautious about the year ahead given the challenges of the economic outlook and consumer confidence,” McClintock said, speaking at the group’s annual meting in Melbourne recently.

He said the business would be affected by major refurbishments and face increased operating costs in 2014 and that Myer would benefit the following year from “stronger fundamentals as a result of the completion of major refurbishments, the online business becoming profitable and the ongoing optimisation of our store network”.

During the current financial year, three of Myer’s top 20 stores will be refurbished.

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Myer department stores predict online profit next year

Wednesday, October 2nd, 2013

Upscale Australian department store Myer is predicting that it will turn a profit from online sales for the first time in 2014, as it simultaneously revealed that its annual net profit fell by 9%.

Myer chief executive Bernie Brookes blamed generous penalty rates and wage costs under Labor’s Fair Work Act for a $10-$11 million negative impact on its $127.2 million profit.

He said he would consult the new coalition government about changing the act.

Photo credit; Matt Trostle on Flickr

Photo credit; Matt Trostle on Flickr

“We’re hoping that in dialogue with the government we’re given the opportunity to express that we think stopping increases coming in is important,” he told reporters.

Brookes also cited the ability of overseas online retailers to escape 10 per cent GST on products was also an unfair “free kick” damaging local retailers who were Australia’s biggest private employers.

“We’re certainly hoping that Mr Abbott and his team have a big set of ears to what very much needs to change,” he said.

After growing profit in the first half, Myer’s costs blew out in the second half with the cost of doing business increasing 3.1 per cent to $1.01 billion of the year to July 27.

Those costs are expected to increase another 4-5% this fiscal year, with money pumped into online initiatives, new stores and refurbishments.

However, Brookes conceded that is likely to mean profit falls again in the current first half.

But online sales revenue should hit $50 million this year, making the business profitable, Mr Brookes said, before profit grows again in 2014/15 as the benefits of the current spending emerge.

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