Premier bucks dormant trend to post positive
The group, which owns retailers Just Jeans, Jay Jays and Peter Alexander, reported net profit of $46.5 million for the six months to January 26, a 20.7 per cent increase on the previous corresponding period. It declared a fully franked dividend of 19¢ a share.
"We acknowledge that there is still more work to be done before we see the brains all operating at full potential, but we are certainly pleased with the progress to date," Premier chairman Solomon Lew said in an earnings call on Thursday.
"Sales are up. Gross profit margins are up. Costs are well controlled. And working capital usage has been significantly improved."
Revenues from all brands rose 2.6 per cent to $460.3 million. The company recorded "exceptional" online sales growth of 51 per cent, and also saw strong performances in its stationery chain Smiggle in Singapore, with eight of its top 10 best-performing stores there.
Premier said it would continue to focus on raising sales in its core brands, improving gross margins and investing online.
Jacqueline Fernley, head of research at Wilson HTM Investment Group, said while Premier's gross margin performance was healthy, its like-for-like sales growth, which has remained negative, was disappointing despite an improvement from the year before.
"It's clear that's been dragged down by the performance of Jay Jays and, to a lesser extent, Just Jeans, whereas we've seen quite a material turnaround in top line for Portmans and Dotti," Ms Fernley said. "That's certainly what you would expect for a business with some significant change and that's requiring quite a material turnaround in a number of its brands."
Premier closed up 15¢ at $7.85.
Frequently Asked Questions about this Article…
Premier Investments reported a net profit of $46.5 million for the six months to January 26, a 20.7% increase on the prior corresponding period, with group revenues of $460.3 million.
Yes. Premier declared a fully franked dividend of 19¢ a share for the half‑year.
Premier recorded exceptional online sales growth of 51% during the period, which management highlighted as a strong part of the result.
Smiggle showed strong performances in Singapore (eight of its top 10 stores), and Portmans and Dotti delivered material turnarounds. By contrast, like‑for‑like sales were dragged down by Jay Jays and, to a lesser extent, Just Jeans.
Chairman Solomon Lew said sales and gross profit margins are up, costs are well controlled, and working capital usage has been significantly improved as part of the group's ongoing transformation.
Premier said it will continue to focus on raising sales in its core brands, improving gross margins and investing in its online business.
Jacqueline Fernley, head of research at Wilson HTM, said gross margin performance was healthy but like‑for‑like sales remained negative (albeit improved), and that the weak result was largely due to Jay Jays and Just Jeans while Portmans and Dotti showed a material turnaround.
Premier's shares closed up 15¢ at $7.85 following the result.
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