Solomon Lew’s Premier Investments Expected to Nearly Double Profits in Full Year
Solomon Lew’s retail empire Premier Investments continued its streak of strong sales thanks to the recovery of COVID-19 in Australia, forecasting a near doubling of profits for the entire year.
In a business update on Friday, the retailer said its sales since the end of January were up 70%, although this was from a year ago when most of the company’s stores were closed due to of the pandemic. However, sales compared to the first half of 2019, which had not been affected by COVID, still increased by 15.9%.
The retailer, which operates brands such as Peter Alexander, Smiggle and Just Jeans, said the exceptional result was due to strong trading during the Easter holiday period and Mother’s Day, two key events for the rag trader.
Due to stronger-than-expected sales, Premier now expects its earnings before interest and taxes for the 12 months ending late July to be between $ 340 million and $ 360 million, although the company noted that this was based on on there will be no more major COVID lockdowns or other incidents by the end of July.
This is an 82-92% increase from last year’s $ 187.2 million profit and more than doubling the retailer’s profit in fiscal 2019.
Premier has been one of the biggest beneficiaries of retail out of the pandemic, thanks in large part to the company’s efficient and highly profitable online platform. He was also a major beneficiary of the government’s JobKeeper program, receiving more than $ 70 million through the program, though he repaid his $ 15.6 million “net benefit” in early May.
Outgoing chief executive Mark McInnes said the record result was also due to the Prime Minister’s choice to increase his inventory levels ahead of the Easter trading period. Many other retailers have recently reported issues getting sufficient inventory due to COVID-related shipping delays.
“The strategic decision taken last year by [Mr Lew] and I, to build our supply chain and invest significantly in wanted inventory for Easter, April school holidays, Mother’s Day and the winter season, we made sure we are in stock, generating strong sales and gross margin growth across all of our brands, ”he said.