MYR Myer Holdings Limited

   By Rebecca Thurlow 
 

SYDNEY--Australian department store operator Myer Holdings Ltd. said Thursday its first-half net profit slid by 4% as it invested in new fashion brands and store upgrades to battle tough competition from arch rival David Jones and newer international rivals.

The Melbourne-based company reported a net profit of 59.7 million Australian dollars (US$45.2 million) in the six months through Jan. 23, compared to A$62.2 million a year ago.

Myer is striving to turn around a business assailed by foreign retail brands such as Uniqlo and Zara, which have arrived on main street in Australia, and a resurgent David Jones following its acquisition by South Africa's Woolworths Holdings.

Under new Chief Executive Officer Richard Umbers, Myer is spending A$600 million over five years to adjust its product mix, improve its website, close underperforming stores and refurbish others.

Total sales rose by 1.8% in the latest half to A$1.79 billion. Comparable store sales grew by 3.3%, a pickup from the 1.3% growth achieved in the second half of last year.

"Only months into the first year of our five year strategy, we are pleased with the early progress and positive customer response," said Mr. Umbers.

The company edged up its full-year net profit guidance to between A$66 million and A$72 million, from between A$64 million and A$72 million previously. The guidance excludes costs associated with implementing the turnaround strategy.

Myer said it will pay a first half dividend of 2 Australian cents a share, down from 7 Australian cents a year earlier.

Write to Rebecca Thurlow at rebecca.thurlow@wsj.com

(END) Dow Jones Newswires

March 16, 2016 19:58 ET (23:58 GMT)

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