Premier Retail’s strong first half result has been undercut by a difficult second half, with global sales down 18 per cent as a direct result of Covid-19.
Global retail sales fell to $484.2 million, down $106.5 million, during the 26 weeks to July 25 due to the group having shut its global business down during the peak of the Covid-19 pandemic.
However, like much of the retail industry, online sales during the same period skyrocketed for Premier’s brands – which include Smiggle, Peter Alexander, and Just Jeans.
Group online sales grew 70 per cent on the same period of 2019 to $123.3 million, up $50.8 million, and contributed 25.5 per cent of Premier’s total sales for the half.
For the full year online sales were up 48.8 per cent on FY19 at $220.4 million and contributed 18.1 per cent of total FY20 sales.
Since online sales command a larger gross margin than in-store sales, Premier is expecting 2H20 EBIT to land between $58.7 million and $59.7 million. And, as a result, it expects full year EBIT to land between $184.8 million and $185.8 million – an increase on FY19’s underlying EBIT of $167.3 million.
Premier is just one of a large number of retailers currently enjoying a surge in online sales, with customers stuck in limbo between lockdowns and stay-at-home orders, as well as the insecurity of whether or not it’s safe to be in large public spaces.