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Myer Group (ASX:MYR), while describing its FY25 results as “resetting the base to drive growth,” has clocked flat total sales growth of only +0.5% vs FY24, and while it has moved to frame this as a positive, a 1.7% growth rate in 2H25 was attributed largely to sales from Apparel Brands.
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That follows Myer’s acquisition of AB from listed Premier Investments, a deal first announced in October last year. The entity AB is from where we’ve received bricks and mortar retailers like Just Jeans and Jay Jay’s; when the deal was announced, Myer predicted that the new entity could make $31M a year. And if you were only looking at NPAT, you might think that we’re seeing that already.
Profits after tax reflected just shy of $37M for MYR, but statutory profit was negative at -$211M. That was due to the one-off $213M impairment associated with picking up AB; but the fact that sales growth only came in under +2% in 2H25 could suggest many investors think the AB buyout might take a lot longer to become a cash machine for Myer than first thought.
Not helping matters were earnings. While profit after tax came in at $36.8M, EBIT was down -13.8% as the company flagged “challenged retail conditions,” which increased “the cost of doing business” for Myer. And to really add icing to the cake, it isn’t giving shareholders a dividend this time either.
Myer chair Olivia Wirth was, of course, eager to look at positives. “Despite challenging macroeconomic conditions and tough retail markets in Australia and New Zealand, we achieved positive sales growth in our first period as a combined Group.”
“We have started to see the benefits flowing through from the integration of Apparel Brands… in addition to being a transition year, during FY25, we faced challenging macroeconomic conditions and rising costs of doing business.
“By contrast, our trading for the first seven weeks of FY26 has been positive and we are cautiously optimistic about the year ahead, with emerging pockets of improving consumer strength.” Maybe not optimistic enough. Also worth watching in the week ahead will be what short sellers do with this move. While the stock isn’t by any means heavily shorted, interest has been volatile this year so far.
MYR last traded at 51cps.
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