As I wrote here previously, Christmas is fast approaching and retailers are pulling out all the stops to win a share of a coveted retail spend during Christmas.
Over the weekend, I experienced this first hand during a trip to my local Westfield Corp (ASX: WFD) owned shopping centre to do some pre-Christmas shopping.
From my experience and observations, one company that could be in for a bumper Christmas sales season this year is Myer Holdings Ltd (ASX: MYR). Here's why.
Myer is . . . wonderful?
Admittedly, it had been a while since I last visited a Myer store as years of "organised chaos" in its clothing racks and homewares department turned me off from shopping at Australia's largest department chain.
However, as management has promised time and time again, Myer has seemingly regained its mojo as new-ish CEO Richard Umbers implements drastic changes throughout its store network.
Operational changes
The embrace of an omni-channel strategy, a new focus on brands and improved customer service is driving my change in perception to believe that Myer has finally found its feet again.
With customers having options of fast-fashion brands like Topshop and the flexibility of being able to shop anywhere, anytime, Myer appears to be dusting off its antique "bricks-and-mortar" legacy to leap into the 21st century where keeping on trend is key to inviting shoppers back to its stores.
Based on Myer's 2016 full-year results, it seems this approach is working.
Momentum
Over the 2016 financial year, Myer reported net profit after tax doubled to $60.5 million. Total sales across the group swelled 2.9% to $3.3 billion, with same store sales across flagship Victorian and New South Wales stores growing an average 5.6% over the year.
Although the growth in sales came at a cost — with Myer's gross profit margin plummeting 164 basis points — the improved figures allowed Myer to regain lost ground on Woolworths SA owned David Jones, which reported 7% like-for-like sales growth in 2016.
Whilst I'm cognisant the results were off a low base, Myer's turnaround strategy appears to be gaining momentum and providing cause for optimism on the company's Christmas season ahead.
Foolish takeaway
After years of disappointing results, Myer is undergoing a period of long-awaited change. With management active in refreshing stale product lines and improving the customer experience, I believe Myer remains well poised to capitalise on the lucrative Christmas sales period ahead.
Although Myer's price-earnings of 15.9x seems to be pricing in a successful Christmas trading period, I think near term wobbles could throw up a bargain. Accordingly, investors should add Myer to their watch list this silly season.
