JobKeeper, online sales keep Myer in profit as sales plummet 13pc

Myer has blamed reduced foot traffic and the closure of flagship stores during the coronavirus pandemic for its sales slump.

The national department store retailer has booked a net profit after tax of $42.9m for the first six months of the financial year, an 8.4 per cent rise on the previous corresponding period.

However, mandated store closures primarily from Victoria’s second lockdown have dented sales, with the company saying CBD store sales over the period were down by 32 per cent.

Total group sales over the period slumped 13.1 per cent to $1.4b and were fuelled by trading restrictions at Myer’s flagship Melbourne, Brisbane and Sydney CBD stores.

The news drove Myer shares down almost 10 per cent to 29.7¢ at 8.30am.

Myer chief executive John King said the company over the period had been able to reduce floorspace — including an entire floor at Morley Galleria — and negotiate new rent agreements, which allowed for less overheads.

“The focus remains on profitable sales and executing the customer-first plan, which has been adapted to respond to COVID-19 by accelerating, re-sequencing and expanding various initiatives,” he said.

“The strengthened balance sheet provides a solid platform for investing in our digital growth engine which represents a significant opportunity.”

Mr King also said online sales made up 21 per cent of total group sales, with the November Black Friday period assisting in boosting digital purchases.

Regional and suburban stores were relatively strong, with 11 stores across its network increasing sales.

Over the period, Myer lowered its cost of doing business by $18m through rent reductions and waivers.

For the first half of the 2021 financial year, the company obtained $51m in JobKeeper payments from the Federal Government.