Thursday , September 29 2022

(MYR) submarines after it is forced to disclose weak sales figures



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Meyer rejected the report, but ASX's discovery team forced the store to stop trading until it reacted more thoroughly.

After the market closed on Friday, Meyer said total sales fell 4.8 percent in the first quarter, while online sales grew 3.6 percent.

The company reported that the first quarter was generally a loss, but its losses this year were lower than in the same period.

Daniel Miller, an investment portfolio manager at Verteum Asset Management, said the lawsuit would not give investors much confidence without releasing solid profit data.

"In particular how it was exposed – it does not look great," he said, "The rhetoric of the current management team is that they do what every retailer should do anyway – trying to stay away from profitable sales.

"The first quarter is not particularly important for retail discretion – in the second quarter and Christmas sales are key – so it is difficult to read too many numbers, but they look very weak."

Premier Investment, which holds 11% of Mayer, is pushing to oust the company's board of directors at its annual meeting on November 30.

Premier Investment, which holds 11% of Mayer, is pushing to oust the company's board of directors at its annual meeting on November 30.credit:C Merlot

Citi analyst Brian Raymond said December's sales period would be "the first test of Meyer's discipline around a back-to-back discount given the number of major events for sale."

This will be particularly challenging if major competitors such as David & Johnson will continue to use margin rubbing assumptions to boost sales.

Last week, David Jones reported 2.9 percent growth in gross sales (down from 4.8 percent in May) in the first quarter, as online sales rose 48 percent from last year (compared to Mayer's 3.6 percent).

Meyer's online sales accounted for 7.7% of total sales last year.

"We think that David Jones may not be writhing if he gives strong growth, which may affect the success of Meyer's strategy," says Raymond.

Meyer suffers from a drop in sales and profits, and its shares reached a record high of 34 degrees in May.

Premier Investment, which holds 11% of Mayer, is pushing to oust the company's board of directors at its annual meeting on November 30.

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