Premier Investments, which owns Just Jeans, Peter Alexander and Portmans, has reported a 29 per cent rise in full-year profit and is willing to close more stores if landlords do not reduce rents in the COVID-19 era.
Solomon Lew’s company used government subsidies and online sales to reap a $137.8 million net profit after tax for the 12 months to July 25.
While many people did not visit shops due to fear of contracting the coronavirus, they still spent money via the internet, which helped Premier’s online sales jump 48.8 per cent to $220.4 million.
The Peter Alexander chain was a standout. Its sales rose 16.3 per cent to $288.2 million for Australia and New Zealand.
Shoppers’ preference to buy online during the pandemic has encouraged Premier to demand lower rents from landlords such as shopping centres.
Management said if landlords did not accept the shift in shoppers’ behaviour and adjust rents, store closures would be inevitable.
The group also owns the Jacqui E, Jay Jays and Smiggle stores.
More than 70 per cent of Premier stores in Australia and New Zealand have leases due to expire this year, or are in holdover.
In May, the company tried to dictate reduced fees when it said it would pay rent at a gross percentage of sales.
Premier also trades in Asia and Europe and temporarily shut stores across the world on March 26 due to the pandemic and stood down about 9000 workers.
It used government subsidies in seven countries to retain workers.
Virus restrictions particularly impacted shopper numbers at Smiggle stores.
Premier will close 55 of the 131 UK stores this financial year, and four in Hong Kong by October 31.
The company will reduce the value on its books of all Smiggle assets in the UK, Hong Kong, Singapore, Malaysia and Ireland.
Premier has a $1 billion stake in Breville and said it was delighted by the company’s success. It has a $18.1 million investment in Myer.
Premier shareholders will receive a final dividend of 36 cents per share, fully franked. This is lower than the fully franked 37 cents per share paid for the 2019 final dividend.
Giving a progress report on the current financial year, Premier said retail sales for the first six weeks were up 92 per cent.
Sales at Peter Alexander were up 40 per cent during this period.
Shares were down 0.68 per cent to $19.00 at 1513 AEST.
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