Australia's Myer falls 7% as consumer spending woes hurt profit view (updated)

Myer Holdings

08/08/2024 07:57

(Updates with final share moves and analyst comments)
       Aug 8 (Reuters) - Shares of Myer Holdings  MYR.AX  fell
about 7% on Thursday in their worst session in a year, after the
Australian department store chain forecast a drop in annual
profit owing to less spending by consumers and store closures.
    Myer's stock closed 7.1% lower at A$0.780, marking the
lowest close in a month and biggest daily drop since August last
year. It fell as much as 8.9% earlier in the day. 
    Over six million shares changed hands during the day, more
than four times the 30-day average.
    Myer projected a net profit after tax between A$50 million
and A$54 million ($32.76 million-$35.38 million) for fiscal 
2024, a significant drop from the prior fiscal year's A$71.1
million. Sales were also seen 3% below last year's level.
    The bleak outlook reflects "challenging consumer and trading
environment, impact of store closures, inflationary cost
pressures, and underperformance of three speciality brands", the
retailer said in a statement.
    Myer estimated the underperformance of its wholly owned
fashion brands Sass & Bide, Marcs and David Lawrence accounted
for about half of the decline in full-year profit.
    "This reporting season will draw a line under a difficult
year for Australian retailers in which they navigated soft
demand and soaring labour costs," Morningstar analysts wrote in
a note.
    Morningstar predicted flat sales and earnings for Myer in
fiscal 2025.
    Myer will report its fiscal 2024 earnings in September.

    ($1 = 1.5265 Australian dollars)

 (Reporting by Rajasik  Mukherjee and Sameer Manekar; Editing by
Subhranshu Sahu)
 ((Rajasik.Mukherjee@thomsonreuters.com;))