Myer boss hopes for a Christmas miracle but plans for muted season

MYER chief executive Bernie Brookes is bracing for a flat Christmas despite six uninterrupted months of sales growth leading into November and the company notching up its first quarterly sales gain since its 2010 sharemarket float.

Mr Brookes said yesterday that the nation’s biggest department store recorded a 1 per cent rise in first-quarter sales to $688 million. He said Myer was positioned to cater for a muted Christmas season due to the fragile state of consumers and the chance of further bad economic news from the US and Europe.

”Who knows what is going to happen in terms of the fiscal cliff [in the US], the implications of Greece and the debt they have … the consumer is reasonably fragile and we can’t afford to be too buoyant,” Mr Brookes said.

”We are looking for Christmas to be at least flat, maybe better, and have bought stock on that basis and have done our planning on that basis.”

But Myer is showing signs of sustained improvement when it comes to sales. It said on Thursday that for the first quarter total sales were up 1 per cent while comparable store growth (which excludes the impact of new stores opened in the period) was 0.8 per cent better. It marked the first lift in total sales since early 2010 and the second consecutive quarter of comparable store growth.

Investors liked what they saw, sending Myer shares up 13¢, or 6.5 per cent, to $2.13 – a five month high.

In light of the latest sales figures Mr Brookes remained reluctant to pronounce that the worst was over for Myer and other stores in general.

”Two [comparable sales growth quarters] in a row, two centuries for

us in a row is good, but it’s still reasonably tough and we are trying not to call it as the start of the rebirth of department stores and we are not calling it a sudden growth spurt.”

The circumspect stance taken by Mr Brookes is at odds with economic data that suggests consumer confidence was steadily lifting, dangling hopes to struggling retailers that consumers locked in savings mode since the global financial crisis might start to spend again.

”I think we are being cautious,” Mr Brookes said, ”the last thing you want to do is buy a whole lot of stock and then end up marking it down for Christmas and you do your profits.

”While we welcomed the October interest rate cut, there are a myriad of factors currently in the mix … so we continue to be cautious about the trading environment.” Mr Brookes said if Christmas did beat expectations Myer could quickly replenish stock in the store and online.

”We feel very comfortable that if it turns out to be a more positive Christmas then we will be able to cater for it because of our supply chain,” he said.

To help it grab a greater slice of the online retail market, Myer has beefed up its website to now have 40,000 lines and was adding to it as quickly as photos of products could be taken and put up online, Mr Brookes said.

The original release of this article first appeared on the website of Hangzhou Night Net.

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