Portmans performance under scrutiny

24 November 2009

The performance of Just Group fashion retailer Portmans looks set to be a strong focus for parent company Premier Investments over the coming months.

Financial 2009 was hailed as a year of consolidation by Premier Investments, which released its results yesterday, hailing the fashion retail group's performance as solid in tough times. Premier chairman Solomon Lew confirmed Just Group earnings before the deduction of interest, tax and amortization (EBITA) for the year were up 3 per cent on the previous year at $95.3 million.

Acquired in October 2008 by Premier at a time of extreme market volatility and uncertainty, a Just Group strategic review had led to the divestment of the Peter Alexander business in the US. However, performance highs included strong results from the Just Jeans and Dotti brands, the latter of which saw 14 new stores opened during the year.

Meanwhile, "Portmans is yet to deliver and remains a priority," Lew confirmed, adding that a key focus going forward would be the turnaround of womenswear brand (pictured).

Overall, the Premier board believed the full potential of the entire Just Group stable of brands had yet to be delivered, he added.

"We intend to work very closely with Just Group management to strengthen the market position of each brand and leverage higher returns."

As part of this strategy Simon Ratcliffe - formerly supply chain and logistics director for high profile UK retailer Marks & Spencer - had been appointed as Just Group Operations director.

The outlook for fashion apparel businesses was one of "cautious optimism", Lew said.

"For retailers, anticipated further increases in interest rates are never welcome - especially at Christmas, however we also recognise that the real issue for retailers is the strength of the underlying economy and employment - having people in jobs, earning wages and spending in our stores."

"The apparel retail market is currently extremely competitive, with significant discounting on the part of some of our competitors, who are attempting to buy sales through lower margins. While that is clear evidence of poor retail practice and management, it is nonetheless a reality. Our business and brands are well managed but must operate within market realities. That has meant lower levels of group sales than we would otherwise enjoy - but we have not been prepared to chase sales at the expense of margin."

"After 17 weeks of trading, our total sales year to date have increased by 6.7 per cent, with like for like sales being 2.7 per cent higher than last year. We consider this to be a credible performance in the current market environment."

 

 

 

Comments

murray

I agree about discounting, would some one tell myer and the fashion suppliers that constant discounting is bad retail practice, and a brand killer...... clearly they are not aware

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