Premier Investments has labelled the performance of its Just Group portfolio of retail brands in the first half of 2010/11 as "disappointing"
The Melbourne-headquartered firm, headed by retail stalwart Solomon Lew, revealed net profit after tax for the half year to January 29, 2011 was $39.4 million. This was down 7.1 per cent on the first half of 2009/10.
Just Group sales were $458.4 million, down from $472.7 million in the first half of 2009/10. Premier Investments reported the strongest performing apparel brand in the half was pyjama retailer Peter Alexander.
The company said the “disappointing sales performance” was reflective of a very challenging retail environment marked by weak apparel sales, extensive discounting, fragile consumer sentiment and natural disasters that closed 80 Just Group stores at their peak.
“Within that environment, Premier's unisex brands, Just Jeans and Jay Jays were most affected,” Premier Investments said.
“In womenswear, the Portmans turnaround progressed well in the face of the challenging environment with sales up 5.3 per cent on the back of a more fashionable range and improved visual merchandising. Jacqui-E's profit performance improved, but Dotti had a disappointing season, after growing strongly for a number of years.”
Premier Investments said the third quarter of 2010/11 had yet to show any signs of improvement on the first half of the financial year, arguing factors such as natural disasters in Japan and political troubles in Libya were continuing to dampen consumer sentiment.
As such, the company now expects Just Group's earnings before interest, tax and amortisation (EBITA) for the full financial year to be in the range of $80 million to $85 million. This is a significant drop from the company's previous EBITA guidance of $100 million to $110 million.
Just Group operates over 950 stores and is home to seven brands, six of which are apparel retailers.