This article first appeared on GuruFocus .
Release Date: September 22, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Myer Holdings Ltd ( ASX:MYR ) achieved record total sales exceeding $4 billion for the first time in its history, with comparable sales up 0.7%.
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Operating gross profit exceeded $1.6 billion, up 14% on an actual basis, driven by online channel growth of 9.1% and concession growth of 8.2%.
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Myer Holdings Ltd ( ASX:MYR ) delivered a net cash position of $100 million at year-end, with operating cash flow increasing by $9.9 million.
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The company achieved a record Myer One tag rate of 81.5% in Myer Retail and 55.1% in Myer Apparel Brands, with active Myer One customers reaching a record 5.3 million.
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Myer Holdings Ltd ( ASX:MYR ) realized approximately $17 million in benefits from its value creation program and $20 million in synergies from Myer Apparel Brands integration, with an additional $10 million benefit expected in FY27.
Negative Points
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Myer Holdings Ltd ( ASX:MYR ) experienced a challenging macroeconomic environment with volatile trading in the second half, leading to pro forma operating gross profit down 1.6% and underlying EBIT down 7% on an actual basis.
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Cost of doing business increased 2.7% on a pro forma basis, with cost of doing business as a percentage of sales at 29.1%, impacted by inflationary pressures and strategic investments.
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Myer Apparel Brands comparable sales declined 0.3%, with softer performance in brands like Portmans, and segment result was 3.5% lower than pro forma FY25.
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Trading in the first eight weeks of FY27 remained challenging, with total sales down 2.7% and Myer Apparel Brands comparable sales down 5.9%, due to cost of living pressures and subdued consumer confidence.
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Global shipping challenges, including typhoon-related delays of two to three weeks, impacted the timely receipt of summer stock, and promotional activity is expected to continue, pressuring gross margins.
Q & A Highlights
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Q: On the sales trading update, does the impact from the Beauty Hall closures and the WA (Morley) closure fully explain the delta between comp sales growth and total sales growth for Myer Retail? And are there other revamps planned for the rest of FY27? A: Kathy Karabatsis (Group CFO) confirmed comparable sales account for the Sydney Beauty Hall and Morley disruption, and also Roselands. Sydney Beauty is targeted for completion by peak this year, Morley reopens in the next few weeks, and Roselands closes at the end of January. No other store disruptions are planned in the second half at this stage.
Q: On FX, hedging and freight when does the weaker Aussie dollar flow through, and have typhoons/weather disrupted Christmas or late FY27 stock? A: Kathy Karabatsis (Group CFO) said the hedge book means an FX benefit will be seen in the second half. On freight, delays of two to three weeks have occurred due to global trade challenges and recent typhoons, slowing summer stock receipts. Olivia Wirth (Executive Chair) added that Christmas trim was prioritized and is already in, with Christmas opening next week in Melbourne, though some summer fashion has been delayed.
Q: The promotional environment was called out specifically in the second half is that category-specific or across Myer's offer, and has it changed into FY27? A: Olivia Wirth (Executive Chair) said it is market-wide across all sectors of retail, consistent with what other retailers have reported, and the depth of promotion is expected to continue for the foreseeable future. Mid-season and end-of-season clearance are underway, with Black Friday peak trade expected to come early again this year.
Q: Given the promotional pressure, is gross margin improvement difficult from here? A: Kathy Karabatsis (Group CFO) said promotional activity does impact gross margin and it will take some time, though My Apparel Brands has seen gross margin rate improvement, partly at the expense of sales. Olivia Wirth (Executive Chair) added that Myer Retail is focusing on higher-margin private label, with strong FY26 performance in home and kids and newly launched exclusive womenswear and menswear brands still in early days.
Q: Can you give more detail on the September trading improvement was it entirely driven by Father's Day, and how is the consumer evolving from August to September? A: Olivia Wirth (Executive Chair) said volatility continues and August remained soft, but Myer Retail performs well in gifting seasons. Father's Day was the second biggest for Myer, with momentum across categories like men's fragrance and polo shirts, and there was a good start to the mid-season sale. Kathy Karabatsis (Group CFO) also noted the good start to mid-season sale.
Q: For the non-Just Jeans apparel brands, do you now have enough loyalty data and penetration to understand what to do on product and store network? A: Olivia Wirth (Executive Chair) said the data set is broader than Myer One, with a 55% tag rate after about 12 months, plus whole-of-market work on customers and competitive brands. Just Jeans has improved and Dotti stabilized in the second half, but Portmans will take at least 6 to 12 months to turn around under new Pearl Brands CEO Matt McCormack.
Q: Can you update on the National Distribution Centre (NDC) are you ready for peak, and what is the next step after the proof of concept? A: Kathy Karabatsis (Group CFO) said the proof of concept is going live through this peak season, supported by 3PL Toll as last year, and the remaining two-thirds of the NDC has been operating efficiently and will run through peak. After peak, throughput will be reassessed to determine the longer-term solution, with a decision to follow.
Q: When will the apparel brands move to the NDC, and how does that reconcile with the $30 million of synergies targeted by FY28? A: Kathy Karabatsis (Group CFO) said the plan is to come off the apparel brands transitional services agreement (TSA) for supply chain in August 2027, with exact synergy timing to be validated after the first half and peak. She confirmed there are no additional costs beyond the previously flagged $32 million to get the proof of concept live by August 2027.
Q: Can you talk to the concessions outperformance in FY26 and whether it has continued into FY27? A: Olivia Wirth (Executive Chair) said concessions improved partly due to conversions of national/wholesale brands into concessions plus new brands coming in. Concession, national brands and private label all remain key, and womenswear grew for the first time since 2017 (just shy of 5%), reflecting exiting and entering the right brands for a broader customer base.
Q: With sales down 2.7% early in FY27, how will you maintain the 29% cost of doing business (CODB) ratio? A: Kathy Karabatsis (Group CFO) said the ongoing value creation program, which offset cost increases in FY26, continues into FY27 with a plan to deliver significant benefits. She emphasized value creation is about optimization and process improvement, not just cost-out, alongside further integration synergies following the completed Marks & David Lawrence integration.
Q: On Apparel Brands, the trading update shows more deterioration than the market expected what is driving it and how will you turn it around? A: Olivia Wirth (Executive Chair) said the deterioration is largely driven by Portmans, which requires changes to product offering and promotional go-to-market. A plan is in place but the turnaround will take longer, and Portmans is the main reason for the weaker Apparel Brands trading number.
Q: With no final dividend, what are your FY27 CapEx and cash conversion expectations, and what drove the receivables build? A: Kathy Karabatsis (Group CFO) said the FY27 capital envelope is $60 million to $65 million, unchanged from FY26's $65 million. The dividend policy is a 40% to 60% payout and FY26 was paid at the top end of the range. Cash conversion in FY27 will be similar to FY26, with the receivables build due to timing at the
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
