Ahead of Myer acquiring Premier Investments’ Apparel Brands, both Myer and Premier Investments saw their share prices plunge by double digits on Monday after they reported their weak sales performance over the crucial holiday sales period.

By noon on Monday, Premier’s share price was down approximately 15.5% and Myer’s share price was bleeding even more and had plunged by around 16.59%.

For the 26 weeks ending January 25, 2025 (H1 2025), Premier said that its total global sales would be in the range of $855 million-$865 million, with Australian sales “broadly flat.”

Premier Retail forecasts its underlying earnings before interest and taxes for H1 2025 to range between $160 million and $165 million – lower than its $204.9 million result (excluding interest revenue) in the prior corresponding period.

 

Premier expects its Apparel Brands business, which consists of Just Jeans, Jay Jays, Portmans, Dotti and Jacqui E to deliver global sales for 1H25 in the range of $405 million – $412 million and underlying EBIT in the range of $31 million to $35 million, $16 million to $20 million less than for the first half of 2024.

Premier Investments urged its shareholders to vote in favour of the combination of Myer with Apparel Brands in a general meeting scheduled to be held on 23 January 2025.

Former Qantas executive Olivia Wirth was appointed Myer executive chairwoman last month

Myer too reported disappointing results. In its trading update for the 22 weeks to December 28, it said that total sales were approximately $1.59 billion, down 0.8% on the prior corresponding period.

Operating gross profit at Myer was approximately $560 million, down $15 million on the prior corresponding period while earnings before interest and taxes was approximately $48 million, a decrease of approximately $16 million

Myer, in its filing to the ASX, also noted the H1 2025 trading update from Premier Investments and said that Premier’s retail businesses including Apparel Brands were similarly affected by the challenging trading conditions overall.

“In challenging trading conditions for the retail sector driven by a tough macroeconomic environment, Myer’s year-to-date sales performance has been stable. Trading during last year’s key sales events including Black Friday was strong, but consumers remain cautious and focused on value given persistent cost-of-living pressures,” said Myer Executive Chair, Olivia Wirth.

Myer’s half-year reporting period concludes on January 25, with interim results expected to be released in March.

As with Premier, Myer is also encouraging its shareholders to vote in favour of the Premier deal at an extraordinary general meeting scheduled for January 23.

Already, Kroll Australia, which was appointed by Myer as an independent expert to assess the merits of the proposed Myer-Premier Investments deal, has termed the combination as “fair and reasonable.”

The proposed deal will see Myer acquire Just Jeans, Jay Jays, Portmans, Dotti and Jacqui E from Premier Investments for more than $860 million in Myer shares which will then be distributed to Premier shareholders, of which Premier Investments’ chairman Solomon Lew is the largest shareholder.

The deal is expected to result in a footprint of more than 700 stores for the combined entity. Myer currently has 56 stores, but will take on 719 Apparel Brand stores across Australia and New Zealand.