Myer hit with $486 million net loss

Embattled department store Myer has posted a statutory net loss of $486 million over the 52 weeks to July 2018, compared to an $11.9 million net profit the year prior.

Net profit halved to $32.5 million year over year, but $518.5 million in implementation costs and individually significant items plunged the company into the red.

Total sales were down 3.2 per cent to $3.1 billion from $3.2 billion the year prior, while total online sales reached $239.4 million.

“The FY18 financial results are disappointing,” Myer chairman Garry Hounsell said.

“When it became apparent to the board that the execution of the strategy was not going to deliver an improved financial performance, we made the decisive move to make significant leadership changes.”

Last month, Myer cut 30 senior executive and management roles from the business, citing a need to operate more efficiently and improve the financial performance of the business.

Myer chief executive John King noted that shareholders deserved better.

“Since joining Myer in June 2018, I have completed a thorough review of the business, including visiting 44 stores and have met with customers, team members, suppliers, brand partners and landlords,” King said.

“Our plan is to put our customers first in everything we do. We are refocusing our efforts on marketing and our product offering. We know our customers want high quality, on trend products, at the right price, supported by great customer service.”

King outlined plans to change Myer’s product range, store layout and online offering moving forward, with the expectation that these will influence how the department store trades during Christmas 2018.

The renewed plan will see in-store customer experience transformed through simplified business procedures, efficient use of factory to consumer, and accelerated cost reduction.

“We will be focused on delivery and execution, not promises,” King said.

“I am confident that with the successful execution of this plan, we will improve the performance of the business and delivery shareholder value.”

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Comments

3 comments

  1. Sujay Vilash posted on September 12, 2018

    CEO King doesn't get it. As a family, we have stopped shopping at Myer. Reason? 1. Poor service. There are not enough floor staff to help with product information or to process the sale. When you can get a hold of someone, their attitude dictates that they would rather be doing something else than helping you understand a product. 2. That leads into product knowledge (or lack thereof). Many a times we have asked for help and been told that they didn't know but would find someone who can help. Problem being, they can't find someone else and keep customers waiting. 3. Unreasonable prices. I used to buy my Van Heusen shirts from Myer. But I can find the same shirts elsewhere for half the price. And the practice doesn't stop at shirts. I found an electronic item that had a mark price higher than the actual RRP. If they cannot address the three points above, amid a list of things, Myer's performance will not improve. Might eventually disappear.

  2. Giles Waggett posted on September 12, 2018

    It seems that Myer are trying to fix the problem from the top down instead of the bottom up. The most significant reason to shop in a bricks and mortar retail outlet is to enjoy [what is commonly referred to as] a "retail experience" Top of that experience is prompt, polite and professional service. In my experience this has always been sadly lacking in Myer stores. Love of retail andof customers has to be an essential prerequisite for any, and all, staff/managers in a retail environment. This is not learned but comes from within. If an applicant's attitude is right you can teach them aptitude. Get this aspect correct, then focus on other things. In short. Look for the simple answer first. Kind regards.

  3. Ralph Hanley posted on September 13, 2018

    “We know our customers want high quality, on trend products, at the right price, supported by great customer service.” Oddly enough I think that's what Myer customers have always wanted. Amazing it took this long to work that out - asking ten customers at any store would have revealed this.

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