AAP Finance

Myer’s $172m FY loss, more stores to close

By AAP Newswire

Myer has reported a full-year loss of $172.4 million after sales fell more than 15 per cent from temporary store closures due to the coronavirus pandemic.

The retailer closed its 60 stores for most of April and May, and had fewer customers for most of the second half of the financial year.

The virus impact was greatest at CBD stores, which are generally larger and have higher rents. Total sales dropped 15.8 per cent to $2.5 billion.

Chief executive John King said CBD stores were a significant concern while most workers avoided city centres, and there were no tourists.

He said many people would continue working from home and customer numbers at CBD stores would not return to pre-COVID levels.

"COVID has permanently changed the way customers shop," he said.

Myer would continue to reduce shop space in preference for a multi-channel approach, he said.

"The need to reduce floor space has never been more apparent than now."

Impairment costs to brand names of $95.9 million were also a big part of the net loss after tax, which covers the 52 weeks to July 25.

Mr King was keen to talk about online sales, which rose 61.1 per cent to $442.5 million. This accounted for 17 per cent of total sales.

Beauty and homewares goods had the biggest growth in online orders.

Myer's online-only competitors such as Kogan and Temple & Webster have boomed during the pandemic as many people decided not to visit shops.

Myer is ramping up online sales efforts. In August it struck a deal with Australia Post to provide warehousing and online fulfilment services.

The group has also introduced parcel pick-up points for Amazon customers at 21 stores.

Chief financial officer Nigel Chadwick gave a trading update for the current financial year.

"Victoria is trading well down, as you would expect," he said, referring to virus restrictions.

"The rest of the country is much better, but still a bit down year on year.

"Online is going great guns."

Myer has revised and extended its bank lending facility to August 2022.

The facility is for $340 million, lower than the previous one of $360 million.

A final dividend payment has been suspended. No final dividend was paid for the 2019 financial year.

Shares were down 17.65 per cent to 21 cents at 1458 AEST.