The Myer Holdings Ltd (ASX: MYR) share price is pushing higher on Thursday.
At the time of writing, the department store operator's shares are up 5.5% to 84 cents.
This follows the release of the company's half-year results.
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Myer share price higher despite profit decline
- Total sales down 3% to $1,829.1 million
- Cost of doing business up 1.6% to $449.4 million
- EBITDA down 10.4% to $215.7 million
- Net profit after tax down 19.9% to $52 million
- Fully franked interim dividend of 3 cents per share
What happened during the half?
For the six months ended 27 January, Myer reported a 3% decline in sales to $1,829.1 million.
This was driven largely by store closures, which offset a 0.1% increase in comparable sales growth and a 2% lift in online sales to $390.1 million. The latter now represents 21.3% of total sales, which is up from 20.3% a year earlier.
The biggest disappointment for investors will no doubt be its profits. Myer's EBITDA was down 10.4% to $215.7 million and its net profit after tax dropped 19.9% to $52 million.
This led to the company's board cutting its fully franked interim dividend by 25% to 3 cents per share.
Management commentary
Myer's CEO, John King, was pleased with the half given the macroeconomic challenges. He said:
The Customer First Plan continues to deliver for Myer despite the macro economic conditions. We were able to achieve a strong comparable sales outcome, cycling our best ever 1st half sales on record in FY2023 and saw improvements in our market share across both stores and online.
Our underlying profit result has remained robust despite the impacts from our Brisbane Store closure and increased promotional cadence. The ramp up of our new National Distribution Centre in Q4, continued roll out of new shopping experiences and brands, tight inventory management and continued focus on newness in 2H, will help with momentum into the second half.
Board changes
It has been revealed that John King will be stepping down from the role as CEO in the coming months and incumbent chair, Ari Mervis, will exit with immediate effect.
The Myer board has appointed independent non-executive director, Olivia Wirth, as its executive chair to drive the company's next phase of growth.
Myer's executive general manager of stores, Tony Sutton, has been promoted to the new executive position of chief operating officer, reporting to Ms Wirth.
Its current independent non-executive director, Dr Gary Weiss AM, will become deputy chair and lead independent director.
Outlook
During the first six weeks of the second half, department store comparable sales are up 4.9% over the corresponding period.
Outgoing CEO, John King, said:
Like all retailers, we continue to remain cautious about the macro-economic environment, however, we are encouraged with our results for the first six weeks of 2H, and have a strong program of deliverables to roll out during the half as part of our Customer First Plan.
In other news, the company is looking at potentially offloading its sass & bide, Marcs, and David Lawrence businesses. It has appointed advisors to commence a strategic review.
The Myer share price remains down almost 20% over the last 12 months.
