Department store Myer has suffered a 22 per cent profit slide, but expects the year ahead to improve as recent store refurbishments, including in Adelaide, help lift sales.
The retailer made a net profit of $98.5 million for the 12 months to July 26, down from $127.2 million year ago.
In response, the department store cut its final dividend to 5.5 cents per share, fully franked, down from eight cents a share last year.
Total sales for the year were virtually flat at $3.14 billion, but Myer blamed the result on refurbishment work at four stores and the closure of two others.
Comparable sales, which exclude the impact of the refurbishments and closures, were up 1.2 per cent for the year and 2.1 per cent for the fourth quarter.
Chief executive Bernie Brookes said the completion of the refurbishment work should help lift sales during the 2015 fiscal year.
“As expected, our investment in the business during the year adversely affected profitability however we look forward to the benefits beginning to be realised in FY2015,” he said.
“Myer is positioned to deliver an anticipated improvement in sales in FY2015 benefiting from the recently refurbished stores at Adelaide and Indooroopilly, expansion of our flagship Melbourne City store, the imminent launch of two new stores at Mt Gravatt (October 2014) and Joondalup (November 2014) and the completion of refurbishments at Macquarie (October 2014) and Miranda (November 2014).
“We expect continued online sales growth, and a positive customer response to several exciting new brands including Alex Perry and L Lisa Ho and a strengthened menswear offer with the introduction of brands such as M.J. Bale, Herringbone and Scotch & Soda.
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“We look forward to leveraging the valuable insights and experience of our recently strengthened leadership team as we continue to evolve our strategy and deliver improved shareholder value.”
Investors punished the store for the result, sending Myer shares down 21 cents to $2.26 as of 11am AEST.
