Myer shares plunge as profits slump; retail expert warns 12 months could define the chain's future

Australian department store Myer Group on Tuesday reported a year-to-July 26 profit tumble, sending its shares into a freefall. The retailer disclosed net profit after tax of $36.8 million, down about 30 percent from the prior year, while earnings before interest and tax fell nearly 14 percent to $140.3 million. A $211.2 million statutory loss, linked to the acquisition of five fashion brands from Premier Investments — Just Jeans, Jay Jays, Jacqui E, Portmans and Dotti — also weighed on results. Shares opened about 15 percent lower and by midday were down nearly 29 percent, trading around $0.46.

Executive chairwoman Olivia Wirth described FY25 as a transition year as the group beds down the new brands and executes a $30 million cost-cutting plan. She said, "FY25 was a transition year for Myer Group as we reset the base to position the business for long-term growth," and noted that the combined group posted positive sales growth in the first period after the acquisition. The company highlighted a 22.9 percent rise in online sales for the year and said group sales in the first seven weeks of 2025-26 were 3.1 percent higher than the prior year.

Retail analyst Dr Gary Mortimer warned that the clock is ticking for Myer. He pointed to a year-one performance for the acquired brands where Just Jeans, Jay Jays, Jacqui E, Portmans and Dotti sales were flat or declined in the second half of 2024-25, and cautioned that discretionary spending remains under pressure as households juggle rent, mortgages and essential costs. Mortimer said discretionary spending is down and hinted that competitors such as Target and Kmart could intensify competition in fashion and homewares. He added that brands like Dotti are exposed to international fast-fashion rivals such as Shein and Temu, underscoring the need for a clearer value proposition across Myer’s breadth of apparel brands. "If they want people to spend in-store, it will require some cost-of-living relief," he said. "This is early days for Myer, so the next 12 months will be telling."

Founded in 1900 by Sydney Myer, the department store chain has grown into Australia’s largest network, operating more than 750 stores across Australia and New Zealand. In recent years it has shut flagship outlets in Hornsby, Brisbane’s CBD, Belconnen in Canberra, and Melbourne’s Knox, part of a broader shift away from flagship locations as the group pursues a more distributed format.

On the growth front, Myer reported a 22.9 percent jump in online sales for the year and said early results for 2025-26 point to a cautious recovery, with group sales for the first seven weeks of the new year up 3.1 percent versus the prior year. Wirth said the group is moving at pace with its strategy to slash costs and expand the Myer One loyalty program to the new apparel brands, including Just Jeans, while the loyalty relaunch is on track for October. She emphasized that the next 12 months will be crucial for the future of Australia’s iconic department store as it refines its value proposition and navigates a challenging consumer backdrop.