Premier Retail to close four Sydney stores despite good performance

(Source: Supplied)

Premier Retail says it achieved a modest increase in sales for the half year to January 29, despite losing 42,000 trading days to Covid-related lockdowns and movement restrictions.

Referencing a ‘volatile trading environment’ the parent of retail chains Portmans, Dotti, Just Jeans, Smiggle, Peter Alexander, Jay Jays and Jacqui-E, said it will close four stores in the Mid City Arcade in Sydney’s CBD. Peter Alexander, Smiggle and Portmans will close by March and Just Jeans by no later than July.

Despite widespread store closures, Premier Retail estimates sales were up by 0.5 per cent during the first half of the financial year. Online sales grew by 27 per cent and account for a quarter of total sales. In a trading update, the company said its earnings before income and taxes are expected to range between $209.5-$211.5 million.

Richard Murray, CEO of Premier Retail expressed that this half was particularly ‘challenging’ as both businesses and customers tried to navigate their way around prolonged government-mandated lockdowns.

“The group has weathered the numerous logistical challenges during the half through meticulous planning and by taking full advantage of Premier’s own Australian Distribution Centre.

“Reviews of the group’s distribution centre capabilities in both Australia and New Zealand continue as part of a long-term strategy to meet ongoing demand as customers change their shopping behaviour in the wake of Covid,” he said.

Due to the growing momentum in preference for online shopping, the company was focused on achieving the profitability of each individual store. It had been able to negotiate rent adjustments with the majority of its landlords to appropriately rebase rents for the future, but a minority had not been amenable.

“It is not the group’s objective to close any stores. However, store closures are necessary and inevitable when landlords do not accept this shift in consumer behaviour.”

The company will release audited results by late March.

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