Premier Investments Limited (ASX: PMV) today announced the record net profit after tax of $88.8 million, up 13.0%, for the first half of Fiscal 2019. Premier Retails’ Earnings before interest and tax (EBIT) stood at $113.9 million, up 11.1% on the underlying 1HFY18.
Despite several challenging trading conditions in the retail sector, Premier flagged the revenue growth of 8.0%, taking its retail sales to a record level of $680.2 million in 1HFY19. The sales figure underscores the record online sales of $75.7 million growing to 12.9% of respective markets’ sales as well as the record Peter Alexander and Smiggle sales of $130.4 million and $178.8 million, respectively.
Premier Retail CEO, Mr Mark McInnes said: “Premier Retail’s record first-half results is a testament to the Board and Management’s understanding of today’s dynamic retail environment. Online continues to exceed the company’s high expectations while Peter Alexander remains well ahead of its 2020 Growth Plan. Smiggle’s Accelerated Global Growth Strategy is progressing well with partnerships announced today with leading iconic retailers providing significant new exposure of the brand to a combined population of over 775 million in ten additional countries.”
The apparel brands of the company delivered exceptionally strong results with sales up 7.5% in the first half while the like-for-like growth was even stronger with positive 8.8% as Premier continued to close unprofitable stores due to unrealistic landlord rents. Over the past six years, the Group has shut down a total of 101 stores with 16 stores being closed in just past 12 months.
On the back of robust performance of the Group, the Board declared an increased record interim dividend of 33 cents per share fully franked, up 13.8% or 4 cps on 1H18. The dividend is reported to be paid on 14 June 2019 with a record date of 31 May 2019.
Premier Retail is currently progressing through its four major pathway to accelerate and diversify Smiggle’s global growth. Commencing in 2H19, the four new pathways to global Smiggle retail sales growth is reportedly expected deliver much higher EBIT margin with materially less capital and generate far higher cash flows than the originally planned multi-country own store rollout.
Further, the company’s retail segment is expected to launch Smiggle with Amazon Europe in France, Italy, Germany and Spain between April and July 2019. Premier Retail will also launch New Zealand transactional websites for Just Jeans, Smiggle, Portmans and Jacqui E in 2H19
For Peter Alexander, the company confirmed that its strategic 2020 Growth Plan of delivering in excess of $250 million in annual sales by FY20 is well ahead of plan. Peter Alexander has confirmed four new stores to open in 2H19, adding to the 26 new stores already opened in the past 18 months.
As per the company’s information, Premier’s balance sheet includes an equity accounted value of $238.9 million for its holdings in Breville Group Limited. The current market value of the investment is $602.6 million based on a share price of $16.51 on 20 March 2019.
PMV is trading at $16.395, down 0.697%, as at 22 March 2019 (1:12 PM AEST).
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