DEPARTMENT store chain Myer has appeared to yield to demands from billionaire rag trader Solomon Lew to release its quarterly sales results ahead of its highly anticipated strategy planning day.
Lew, who has a 10.77 per cent stake in Myer through his retail group Premier Investments, has spent weeks piling on the pressure to replace the Myer board culminating in a claim this week that it failed to keep the market informed about its trading performance, while raising the prospect of legal action.
Myer today announced its Q1 sales for the 13 weeks to Saturday 28 October were down by 2.8 per cent to $699 million.
CEO Richard Umbers blamed the further drop on the "challenging" retail landscape and is hoping for a recovery during the latter part of the calendar year.
"Sales during Q1 FY18 reflect the continuation of challenging retail conditions characterised by heightened competition and subdued consumer sentiment," says Umbers.
"Myer remains focused on the upcoming and more significant trading periods of Spring Racing and Christmas during Q2 FY18."
These results follow the continued threats from Lew, who is Myer's biggest shareholder.
Last week, Lew declared war against the department store with a personal letter released to the ASX lamenting the chain's 'demise' and called on shareholders to vote against the reappointment of all its directors at Myer's AGM.
Lew also took aim at incoming Myer chairman Garry Hounsell for suggesting that a meeting between the two over the future of the company had not taken place as the battle for board control became personal.
"This request was taken to the Myer board by Mr Hounsell and rejected," Lew said in the statement last week.
"Mr Hounsell then inferred to the media that he was yet to meet with Mr Lew, and publically backed the "New Myer" strategy against all of the evidence that it is not working."
Hounsell hit back by telling shareholders that allowing Solomon Lew into the company's boardroom would be "enormously damaging", and called on shareholders to instead back an "independent" Myer.
He also said Lew was interested in only pursuing his own interests, not those of all Myer's shareholders.
The embattled retailer is today holding a strategy meeting where it is expected the group will launch a new corporate strategy.
Lew has also been critical of Myer's investment decisions. In July, the company announced it will take a $45.6 million hit after writing off the value of its 20 per cent stake in Topshop's Australian franchise and impairing the value of its struggling sass & bide brand.
Myer released its worst profit result since 2009 in September when its statutory net profit dropped 80 per cent to $11.9 million in the 2017 financial year due to the writedowns and a fall in revenue, which also prompted the announcement of store closures.
This morning the group announced it will launch a new online marketplace in a bid to extend the range of its online offering and bolster its online credentials ahead of the launch of Amazon in Australia.
The marketplace, dubbed Myer Market, will be built in partnership with platform vendor Marketplacer, and will launch once Myer is satisfied with the range on offer.
Business News Australia
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