Premier Investments’ (PMV) full year sales cracked the $1 billion mark for the first time and the retail chain owner reported a 18% jump in earnings and lifted final dividend.
The company, controlled by Solomon Lew said net profit for the 2015-16 year to July was $103.9 million, while underlying net profit surged jumped 22.6% to $145.4 million.
Final dividend was lifted to 25 cents a share from 21 cents, making a total for the year of 48 cents, up from 42 cents a share in 2014-15.
Premier shares though fell 42% to $16.17. they were down close to 5% at one stage.
The company said sales in its Smiggle chain surged by almost 42% in the year (and near 80% in the last two years) while Premier’s Peter Alexander chain saw a 20.4% jump in sales.
Sales across Premier’s seven retail chains, including Peter Alexander, dotti, Jacqui E, Jay Jays, Just Jeans and Portmans, rose nearly 11% to $1.049 billion for the year to July 30.
Same store sales across the group’s retail brands rose a solid 3.5% over the year.
Smiggle’s sales reached $188 million for the year, as it expanded across the UK and opened its first stores in Malaysia and Hong Kong. Premier said the UK’s vote in June to leave the European Union did not hurt Smiggle’s sales or new store openings.
“The sales performance of the brand in the UK post Brexit, has been equal to or better than prior to the vote,” the company said in yesterday’s statement to the ASX.
"This strong trading pattern combined with strong market position reinforced the view that Smiggle UK has the potential for 200 stores with annual sales in excess of $200 million by calendar year 2019."
Smiggle opened 52 new stores during 2015-16, including 40 new stores in the UK, seven in Australia and five across Malaysia and Hong Kong. It also has stores in New Zealand and Singapore.
The group plans to have between 85 and 90 Smiggle stores trading before Christmas in the UK and 10 in Malaysia and Hong Kong. Premier said its gross margin was up 78bps to 63.9% despite the weaker Australian dollar, increasing competition and an unseasonably warm Autumn.
Premier’s Chairman Solomon Lew said in yesterday’s statement to the ASX: “The Premier Retail team, led by Premier Retail CEO Mark McInnes, has again delivered a very strong performance in a difficult retail environment. The 2016 result demonstrates the continued successful implementation of the Premier Retail Strategy to drive growth through Smiggle, Peter Alexander and our online offer while rejuvenating our core brands and improving efficiencies.
“Once again our online sales significantly outperformed the market, with our online sales growing by 39.6%. We will continue to make significant investments in technology, people and marketing, to achieve annual online sales of over $100 million by 2020.”
Premier Retail CEO Mark McInnes said in yesterday’s statement: “Our first class team has delivered record sales, gross profit and EBIT in a highly competitive and volatile environment.
“Our strategy is unchanged and we continue to pursue it relentlessly – investing in expanding Smiggle globally, growing Peter Alexander significantly and delivering a superior online experience for our customers while achieving efficiencies and continuing to invest in our core apparel businesses.”
At the end of the year, Premier said it had cash on hand of $283.2 million plus its equity accounted investment in Breville Group Limited at $213.4 million. Premier said the market value of this holding was $295.1 million at 20 September 2016.
