Setback For Lew As Myer Returns To Profit, Names Stephenson Chair
Solomon Lew has been given a bloody nose at Myer, with JoAnne Stephenson – whose ouster he had sought – named chair of the Board as the retailer posts a return to full-year profit.
Stephenson, who had been serving as acting chair after Lew orchestrated the rolling of former chair Garry Hounsell last year, was one of three non-executive directors whose resignation Lew and his firm Premier Investments had demanded in July as part of Lew’s campaign for the Myer board. She is joined by new director Ari Mervis, chair of McPhersons Ltd and former MD of SABMiller in the Asia-Pacific.
Myer enjoyed a solid year, as foreshadowed in a trading update released last month, with a net profit after tax of $51.7 million – up from a $13.4 million loss in FY20 – and total sales climbing 5.5 per cent to $2.66 billion; online sales grew 27.7 per cent to $539.5 million, now representing 20.3 per cent of total sales. The company has withheld a dividend, however, citing uncertainty around the lockdowns in NSW, ACT, and Victoria.
Myer CEO and MD John King said the result shows the business is thriving in spite of the hardships inflicted by COVID.
“Despite the on again off again nature of physical retail over FY21, when combined with continued growth in the online business, we delivered solid sales growth when not impacted by lockdowns, particularly in 2H21.
“As we have consistently said over the past three years our focus has been on profitable sales, growing the online business, disciplined management of costs, cash, and inventory, space optimisation and the deleveraging of our balance sheet. The successful execution of these, and many more strategic initiatives, has delivered solid growth across all our key metrics in FY21,” he said.
King says the business is well-placed ahead of the peak holiday period, with continued improvements to its merchandise cycle including improved margins, reduced aged stock, and clearance levels at record lows.
“The sustained profitable growth in our online channel again demonstrated the benefit of our multi-channel approach to market and now represents a meaningful 20.3 per cent of total sales.
“There was significant growth achieved during 1H FY21, in particular during the Black Friday 4-day sale period in the lead-up to peak Christmas trade,” he said.
Premier Investments is tipped to call an extraordinary general meeting before or after the AGM slated for November 4, after failing to meet Myer’s September 2 deadline for Board nominations.