Myer Holdings Posts $4.09 Billion in FY26 Sales Despite Economic Challenges and Consumer Uncertainty

Second-Half FY26 Trading Volatility Driven by Cost-of-Living Pressures and Declining Consumer Confidence

Myer Holdings experienced notable month-to-month trading fluctuations in the second half of FY26, primarily due to persistent cost-of-living pressures that pushed consumer sentiment to recent lows. The company cited multiple macroeconomic challenges restricting household budgets and discretionary spending, including inflation from elevated fuel prices linked to the Middle East conflict, three interest rate hikes in calendar year 2026, slower household income growth, a weakening housing market, and broader financial uncertainty affecting many Australian consumers.

Trading conditions worsened sharply in June and July 2026 following a stronger recovery phase in May. These difficulties were exacerbated by warmer-than-average winter weather across major Australian cities, negatively impacting seasonal apparel sales. In response, Myer increased promotional activity to stimulate demand. Although value creation initiatives and integration synergies provided some support, management acknowledged these measures were insufficient to fully counteract the pronounced decline in discretionary consumer spending.

FY26 Sales Analysis: Actual Growth Contrasted with Pro Forma Stability Across Categories

Total FY26 sales reached $4,089 million, an 11.3% increase on an actual basis. However, this figure includes 12 months of Myer Retail and only six months of Myer Apparel Brands in FY25, compared to 12 months for both divisions in FY26, making pro forma figures more indicative of true performance. On a pro forma basis, which accounts for 12 months of both divisions in each year, total sales rose only 0.3%, highlighting a more challenging underlying trading environment.

Category performance varied widely. Strong growth was recorded in Home, Womenswear, Kids, Marketplace, and Concession sales, while Beauty and Portmans experienced declines. The Myer Retail division saw total sales grow by 0.7% with comparable sales up 1.0%, whereas Myer Apparel Brands’ pro forma total sales decreased by 1.3%, with a smaller 0.3% drop in comparable sales. The overall group comparable sales increased modestly by 0.7%, indicating some resilience in like-for-like store performance amid difficult conditions.

Operating Gross Profit Declines on Pro Forma Basis Due to Increased Promotions and Margin Pressure

Operating gross profit for FY26 is estimated between $1,601 million and $1,607 million. This represents a 13.8% to 14.3% increase on an actual basis compared to FY25, reflecting the full-year inclusion of Myer Apparel Brands. However, on a pro forma basis, OGP declined by 2.1% to 2.5%, signaling margin compression driven by heightened promotional activity aimed at boosting demand.

The OGP margin is estimated at approximately 39.2% to 39.3% of total sales, up from 38.3% on an actual FY25 basis but down from 40.3% on a pro forma FY25 basis. This margin contraction reflects intensified discounting in the second half to attract customers and sustain sales momentum. Despite this, the cost of doing business (CODB) percentage remained aligned with the FY26 target of around 29%, demonstrating effective cost control amid inflationary pressures and weaker sales volumes.

Record Loyalty Program Growth and High Customer Tag Rates Fuel Strategic Expansion

Myer Holdings achieved record milestones in customer loyalty during FY26, with active loyalty program members reaching 5.3 million, up from 4.7 million in FY25—an increase of approximately 600,000 members. The Myer Retail division recorded a record tag rate of 81.5%, up from 79.5% the previous year, while Myer Apparel Brands attained a 55.2% tag rate within less than 12 months of launching its loyalty program.

Supporting these achievements, Myer launched the Myer Media Network powered by the MYER one retail media platform. This initiative capitalizes on retail media trends by monetizing first-party customer data and offering targeted advertising opportunities for brand partners. The strong loyalty engagement indicates positive customer response to the company’s integrated retail experience despite challenging consumer spending conditions.

Brand Portfolio Expansion: 37 New Beauty and 29 New Fashion Brands Added

During FY26, Myer Holdings expanded its brand portfolio by introducing 37 new Beauty brands and 29 new brands across Womenswear and Menswear. The company also secured access to prominent global brands including Fenty Beauty, La Mer, Guerlain, and GAP, enhancing its merchandise mix and brand appeal.

These additions underscore management’s commitment to product diversification and differentiation, aiming to attract and retain customers across multiple segments. The blend of mass-market and premium brands supports a multi-tier strategy that historically provides resilience during retail downturns by enabling flexible promotional and targeting approaches.

Store Network Optimization: Closures, Openings, Refurbishments, and Marketplace Launch

Myer continued its store network optimization in FY26 by closing 38 Myer Apparel Brands stores and opening 14 new locations, resulting in a net reduction of 24 stores as part of portfolio rationalization. Refurbishments commenced at the Myer Sydney City beauty hall and the Myer Morley store in Perth, reflecting targeted investments in key markets.

A major development was the June 2026 launch of the Myer Marketplace platform, offering 25,000 new products and expanding brand partnerships beyond the traditional department store model. This omni-channel platform enables third-party merchandise curation without the capital and inventory burdens of conventional retail, enhancing economics and customer choice. Additionally, the lease for Myer Roselands in Sydney was extended until January 2027, ensuring continued presence at this location. These network decisions reflect detailed portfolio analysis aimed at optimizing unit economics and competitive positioning amid a challenging Australian retail environment.

Value Creation and Integration Initiatives Bolster Operational Efficiency

Throughout FY26, Myer advanced its value creation program and integration efforts, including closing the Myer Asia sourcing office and one overseas hub, reorganizing staffing flexibility in Myer Retail stores, and restructuring retail operations within Myer Apparel Brands. These actions aimed to optimize operating costs and mitigate inflation and cost-of-living impacts on consumers. While these benefits partially offset CODB increases, they were insufficient to prevent a pro forma decline in operating gross profit.

Integration synergies arose from combining Myer Apparel Brands with the broader group, yielding refinancing and procurement efficiencies, as well as from integrating sass & bide, Marcs, and David Lawrence. Although specific synergy values were not disclosed, management emphasized these initiatives strengthened the business foundation and supported execution of the Myer Group Growth Strategy during challenging market conditions.

National Distribution Centre Proof-of-Concept Progresses Supply Chain Resilience

Myer Holdings continued developing its National Distribution Centre (NDC) initiative in FY26, remaining in the proof-of-concept phase. This cautious approach mitigates execution risks associated with implementing a complex, multi-format retail supply chain solution. The proof-of-concept allows testing of processes, systems integration, and performance metrics before committing to full-scale rollout and capital investment.

This measured implementation is critical amid the FY26 macroeconomic and consumer spending challenges, enabling the company to preserve capital while preparing for improved inventory management, faster product turnover, and enhanced omni-channel fulfillment once market conditions stabilize.

Executive Commentary Highlights Strategic Focus and Near-Term Prudence

Myer Group Executive Chair Olivia Wirth acknowledged the second half of FY26 was significantly more challenging than the first half and FY25, with consumer sentiment deteriorating sharply in June and July after a mixed performance earlier in the period. This context explains the sales results and promotional efforts deployed to maintain customer engagement.

Despite near-term challenges, Wirth expressed confidence in ongoing strategic initiatives, including loyalty program enhancements, brand expansion, retail media platform launch, store network optimization, marketplace implementation, and value creation. She emphasized these actions are strengthening Myer’s competitive position and resilience, supporting long-term shareholder value amid cyclical consumer headwinds rather than structural retail decline.

Full FY26 Financial Results Scheduled for September 2026 Release

Myer Holdings announced that full FY26 financial results will be published in September 2026 following completion of the statutory audit and Board approval. The July 2026 preliminary trading update provides early disclosure of headline sales and profitability metrics, allowing investors and analysts to assess performance ahead of final audited results.

The company noted year-end finalization includes evaluation of impairments and significant items necessary to complete statutory net profit after tax (NPAT). This phased disclosure ensures transparency while preserving audit integrity. Investors should anticipate further details on depreciation, amortization, financing costs, tax, and cash flow when full results are released.