STRUGGLING retailer Myer admitted to the ASX today that its sales and profit margins have "deteriorated in recent weeks" following a lacklustre performance in the first quarter.
Myer shares toppled to an all-time low of $0.67 following the announcement that its profit shortfall is unlikely to be recovered in the first half.
Total sales are down 2.8 per cent and comparable store sales are down 2.1 per cent on the prior corresponding period (pcp), and at the company's AGM last month Myer indicated that trading at the start of the second quarter had shown no improvement on the first.
Myer has also failed to make the most from its crucial Christmas clientele, as sales during the first two weeks of December have weakened by 5 per cent on pcp.
CEO Richard Umbers said the company does not yet know the extent of the impact poor Christmas trade will have.
"Trading during the past two weeks has been significantly below our expectations and the year to date run rate, and while there is an additional weekend of pre-Christmas trading this month, we do not know what the sales impact of that will be," he said.
Although it hasn't specified a new profit range, Myer expects its 1H18's results will be "materially below" the pcp.
Despite the company's bleak outlook amid an unforgiving retail market, Umbers hints at optimism off the back of Myer's online performance.
"There has been continued strong performance in our online business with sales up 62% in the first four months despite cycling a particularly strong previous corresponding period in the lead up to Christmas 2016," said Umbers.
"While this strong growth has not been sufficient to offset the subdued trading in some stores, we take confidence from this performance as indicating that we are investing in the right areas."
Chairman Garry Hounsell said Myer is pinning its hopes on stronger Christmas trade to drag it out of the danger zone.
Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.
Business News Australia
Get our daily business news
Sign up to our free email news updates.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support