Myer stocks plummeted to their lowest ever value after the department store admitted its Boxing Day sales were a disaster.
January revenue was 6.5 per cent lower than last year following Christmas sales in the first two weeks of December dropping by 5 per cent.
The recent slumping sales meant revenue was down 3.6 per cent for the first half of the financial year, and profits even worse.
Myer stocks plummeted to their lowest ever value after the department store admitted its Boxing Day sales were a disaster (Myer model Jennifer Hawkins pictured)
Myer warned profit would dive by up to 42 per cent – only $37 million to $41 million compared with $64 million last year.
Investors were not impressed, having only been told earlier that profit would be ‘materially below’ last year, and started bailing out.
Nine per cent of Myer’s share price was wiped out in a single morning after Friday’s announcement, falling to 58c in the first half hour of trading.
The sustained hits over the past few years makes that price an all-time low since the company was floated on the market at $4.10 in 2009.
Things were so bad that the company’s biggest shareholder, retail investment billionaire Solomon Lew, two days ago called for a shareholder meeting to kick out the entire board of directors.
January revenue was 6.5 per cent lower than last year following Christmas sales in the first two weeks of December dropping by 5 per cent (Myer model Jennifer Hawkins pictured)
Things were so bad that the company’s biggest shareholder, retail investment billionaire Solomon Lew (pictured), called for a shareholder meeting to kick out the entire board
News was likely to get even worse at official half-year results in March 21 as Myer admitted it would be forced to write down its assets.
Myer has just under $1 billion in intangible assets like the value of its reputation and brands – almost double its $527 million market value.
The South African owner of David Jones recently wrote down Myer’s arch-rival by a third of its $2.1 billion total value after a 30 per cent profit fall.
Chief executive Richard Umbers blamed poor sales on too much discounting, less customers walking in, and more online shopping.
Myer warned profit would dive by up to 42 per cent – only $37 million to $41 million compared with $64 million last year (Myer fashion show pictured)
‘Myer recognises the ongoing, challenging and competitive retail conditions and remains resolutely focused on improving foot traffic and sales across all channels’, he said.
‘I am in no doubt that our heightened focus areas including online and productivity are correct for this low growth environment.’
Mr Lew’s Premier Investments owned 10.8 per cent of Myer and so would need many more investors to join his effort to sack the board at a meeting before June.
The furious investor was well on his way to getting the required half the votes as 30 per cent of shareholders lodged protest votes at the November general meeting.