Myer forecasts return to profit growth, shares soar

Friday, 18 Nov 2016 09:12:33 | Thuy Ong

Myer says its final dividend is 3 cents per share. (ABC Central West: Melanie Pearce)

Shares in department store chain Myer have soared after the company said it sees a return to profit growth next year.

Myer has struggled with its share price since listing on the stock exchange at $4.10 in 2009. Investors baulked at its rich valuation, selling out of the stock and its share price has not been able to recover.

At its AGM, Myer said subject to "no significant deterioration in consumer sentiment, 2017 will see EBITDA growth ahead of sales growth and a return to net profit after tax growth before and after implementation costs".

Myer said it is seeking to deliver a sharper and more focused offer to customers and to simplify its business model, and has exited stores at Brookside, Orange and Wollongong.

For first quarter 2017, total sales rose 0.6 per cent to $719.2 million.

"Australia continues to see rapid changes in the retail environment, with the arrival of international entrants and the evolution in consumer behaviour and technology for purchases," said Paul McClintock, chairman of Myer, according to a pre-prepared speech released to the ASX.

"We also work in an economic and political environment that is not without its challenges."

Full year sales grew by 2.9 per cent to $3.3 billion, with full year net profit after tax of $69.3 million, in line with guidance.

Myer said its final dividend was 3 cents per share.

Investors cheered the news, with shares in Myer jumping as much as 10 per cent. By 11:21am (AEDT) shares jumped 7.7 per cent to $1.12, a two-week high.

The department store chain announced a doubling in full-year profit to $60.5 million in September.

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Myer forecasts return to profit growth, shares soar

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