Premier Investments nearly doubles profit in bumper half; shares surge

In the first 24 weeks of the half, global sales rose 5 per cent to $716.9 million, and comparable sales jumped 18 per cent. Premier runs its first half from July 25 to January 30, encompassing the key Black Friday, Christmas, and post-Christmas Boxing Day shopping periods.

Mr Lew said the strong set of numbers were a testament to the strength of the business, labelling the last 12 months as some of the hardest he’d ever experienced.

“The challenges posed by COVID-19 are the greatest set of risks I have ever seen in more than six decades in retail,” he said.

“The entire Premier Retail team, led by our CEO Mark McInnes and his outstanding executives, have led the incredible women and men in our stores, our support offices and our distribution centre to deliver for Premier’s customers and shareholders.

“Their dedication, skill and commitment are evident in the record-breaking results we have announced today.”

Rent abatements, JobKeeper

However, a number of other factors contributed to the business’ record profit figures, including the company striking deals with major landlords on rent abatements and receiving nearly $20 million in JobKeeper payments.

Mr Lew’s empire was one of Australia’s largest retail groups to refuse to pay rent during the pandemic shutdown in March last year, a move which drew the ire of both landlords and fellow retailers.

Premier was also the recipient of at least $19.7 million in wage subsidies for the first half of 2021, with the retailer revealing at its full-year result last year it had pocketed a total $68.7 million through the scheme, some of which was received in August and September.

At the time, Mr Lew and the company received significant backlash, including a rare ‘first strike’ from investors, due to its decision to maintain its 70 cent per share dividend and also award chief executive Mark McInnes a $2.5 million bonus.

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However, the company has been adamant the wage subsidy has been of minimal benefit to its profits or dividend, saying on Wednesday the amount received in the latest half was offset by losses from Victoria’s second lockdown.

“Premier was eligible to receive ‘JobKeeper 1’ during the wage subsidy scheme’s final months of August and September 2020. The loss of gross profit in Victoria during government-enforced store closures for most of [the first quarter] more than offset the wage subsidy support,” the company said.

“Premier Retail incurred significant incremental costs by continuing to pay over 1200 of its full time and part-time Australian team members their contracted hours whilst those teams were stood down due to government-enforced temporary store closures in October, November, December 2020, and January 2021.”

The company will report its interim results at the end of March, with the flagged figures subject to audit and assuming no further COVID damage to profits in the final three weeks of trade.