Myer has posted a $211.2 million statutory loss for FY25, as the costs of integrating Solomon Lew’s Apparel Brands, ongoing supply chain challenges and problems at its Melbourne distribution centre overshadowed solid sales growth.

The result marks a sharp reversal from the $43.5 million profit a year earlier and was dragged down by a $213.3 million non-cash impairment tied to the Apparel Brands acquisition, alongside $34.7 million in merger and restructuring costs.

Excluding these charges, net profit after tax came in at $36.8 million, down 30% year-on-year.

Myer’s sales jumped 12.5% to $3.67 billion following the $1.2 billion merger completed in January, though on a pro forma basis growth was just 0.5%.

Earnings before interest and tax slid 13.8% to $140.3 million, with Myer blaming operational issues at its Melbourne distribution centre which cost an estimated $16 million in FY25 and will require a further $32 million to fix. This leaves the facility unlikely to be ready for the crucial Christmas trading period.

Executive chair Olivia Wirth (pictured) described FY25 as a “transition year,” saying the group is positioning itself for long-term growth by expanding its Myer One loyalty program and accelerating omni-channel integration.

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

“Despite challenging macroeconomic conditions and tough retail markets in Australia and New Zealand, we achieved positive sales growth in our first period as a combined group,” Wirth said.

But the department store also flagged rising costs from inflation, higher wages and rent, and a surge in theft and antisocial behaviour across its network. Myer has invested $4 million in extra security, reporting a 20% reduction in shrinkage.

Shares have dropped nearly 25% in the past year to 64 cents, well below the 98.5 cents valuation used for the Apparel Brands deal. Analysts had expected stronger earnings, with consensus forecasts putting EBIT at $149 million and NPAT at $40.8 million.

Looking ahead, Myer said group sales were up 3.1% in the first seven weeks of FY26, with core retail sales rising 4.3%.

Wirth said momentum is building but warned ongoing cost pressures would require “targeted initiatives” to protect margins.

The retailer will not pay a final dividend, keeping FY25 shareholder returns at 2.5 cents per share, down from 3.5 cents the previous year.