Myer expects slow recovery

Press, 7 December 1976, Page 30

Myer expects slow recovery

NZPA Melbourne Myer Emporium, Ltd, Australia’s biggest departmentstore group, increased profits slightly in the first four months of the year, the managing director (Mr K. C. Steele) said at the annual meeting.

Sales growth in the same period failed to match the rate of inflation. In the last full year Myer’s sales totalled sAust966M. Mr Steele said that they are currently running at a rate in excess of a billion dollars a year, but expenses in the last four months continued to rise, despite efforts to adjust expenditure in sympathy with the adverse sales-trend. “Early forecasts of the likely results for the current financial year are always difficult to make until after a clear assessment of Christmas trading is possible, but obviously from the currently available information I have just outlined, the prospects of dramatic increases in sales and profits for this year are not encouraging,” he said.

“In fact, almost every economic indicator suggests that the national recovery will not occur quickly — on the contrary it will be

achieved only after a long slow haul.” Mr Steele said that, faced with this situation, he should remind shareholders of three of the more important management strategies already embarked upon. “First, we plan to turn this breathing-space to our advantage by more than doubling last year’s capital expenditure with the primary objective of improving our plant and presentation in older stores, both in the capital cities and suburbs. “The company is also intensifying efforts to upgrade the quality, diversity and attraction of its merchandise.

“The company is resolved to redouble its efforts to live up to the slogan, for value and friendly service,” he said. Mr Kenneth Myer, the company chairman, relinquished that position on Friday.

Mr Steele becomes chairman, and Mr Keith Rosenhain becomes managing director. In the twenty years under Mr Myer’s leadership, the sales volume of the company “multiplied over ten fold from S94M to $966M, and after-tax profit rose almost 16 times in the same period,” Mr Steel said.