News

Asahi Group Holdings has named Amanda Sellers as the new group CEO of Asahi Beverages, the company’s Oceania business.

Sellers has been the Group’s interim CEO since June, following the resignation of the previous CEO, Robert Iervasi. 

“The board of Asahi Group Holdings has huge confidence in Amanda’s ability to continue with the impressive growth trajectory of our business in Oceania while also delivering our sustainability commitments and setting us up for long-term success in Australia and New  Zealand,” said Atsushi Katsuki, president and CEO, Asahi Group Holdings. 

Sellers has been working as the CFO for Asahi Beverages for almost five years. She has more than 20 years of experience in the beverages industry and has held senior positions at Treasury Wines, where she served as CFO for Asia and Europe and previously as CFO for Australia and New Zealand.

With her appointment, Sellers has become the first woman to hold the CEO position of a regional headquarters within the Asahi Group.

“As interim group CEO over the past six months, I’ve had the pleasure of getting to know our customers and suppliers much better,” said Sellers. 

“I’m confident that through these valued partnerships and the plans we’ve developed together, we’ll grow our businesses and deliver even more  for our consumers.” 

Australia Post will soon end daily letter deliveries as part of a series of postal reforms announced on Wednesday designed to modernise the government-owned postal service and help it turn a profit.

Letters will only be delivered every second business day for 98 per cent of locations, although parcel delivery would continue daily. Australia Post will also have an extra day to deliver regular mail.

The changes announced jointly by the communications and finance ministers, have been trialled and will roll out over the next 12 months along with other reforms like increasing the number of parcel collection points.

Australia Post CEO Paul Graham said the reforms recognised the “true cost” of mail delivery and would help the service build a more sustainable business focused on parcels.

“As eCommerce continues to boom and fewer and fewer Australians send letters, the changes to letters frequency announced today will free up our posties to also focus on parcels and packages,” Graham said in a statement. 

Letter deliveries have fallen by two-thirds since 2008 alongside a massive e-commerce fuelled boom in package delivery. Australia Post delivered half a billion parcels last financial year, or roughly 20 per person.

But it lost A$200 million ($131.70 million) before tax for the 2023 financial year ended in June, only its second time in the red since 1989, and warned of future losses without reforms.

Losses in the letter business rose 50 per cent to A$384 million.

Australia Post is government-owned but self-funded and required to deliver a financial return.

A trial found the proposed reforms let workers carry up to 20 per cent more parcels and deliver to 10 per cent more locations.

The changes will also allow Australia Post to manage priority mail, roughly 8 per cent of all letter traffic, differently to “deliver services at a more commercial rate,” the joint ministerial statement said.

Australia Post has applied to the competition regulator to increase the basic letter postage rate to A$1.50 from A$1.20 from early near year.

Sigma entered a trading halt on Wednesday as it raises about $350m through Goldman Sachs, as part of plans for a back door listing of the $3bn Chemist Warehouse.

It comes after the pharmacy wholesaler this year won a lucrative Chemist Warehouse contract from rival EBOS.

Chemist Warehouse had previously been working on a potential float with advisory firm Rothschild & Co, but after former UBS investment banker-turned real estate company boss David Di Pilla bought in, some speculated that Chemist Warehouse and Sigma could become close, given Mr Di Pilla’s strong ties to the Chemist Warehouse founders.

It was after his investment that Sigma won a key Chemist Warehouse this year.

The structure of the deal is set to be announced by Sigma imminently.

The $350m being raised by Sigma is to provide working capital, while some say that the money may be needed to provide enough free float, should Chemist Warehouse take scrip in the business that may equal about 90 per cent.

There needs to be at least a 20 per cent free float needed under the ASX listing rules and 30 per cent for S&P index inclusion.

Sigma said on Wednesday it was in a trading halt “pending a material transaction”.

Mr Di Pilla is the managing director of HMC Capital, formerly known as Home Consortium, and he amassed a stake of more than 19 per cent in Sigma more than a year.

He formed the company after buying the sites of the former Masters home improvement chain that were owned by Woolworths.

At that time, the sites were purchased for more than a collective $700m with a consortium that included his former UBS Australia boss Matthew Grounds (now the Barrenjoey group boss), Spotlight Group and Chemist Warehouse.

Also working with Mr Di Pilla has been star equity capital markets operative Robbie Vanderzeil, who has worked at UBS and Jarden.

Sigma is an ASX-listed pharmaceutical wholesaler and distributor and also has a network of independent and franchised pharmacies and healthcare providers across Australia.

Its brands include Amcal, Guardian, Discount Drug Stores and PharmaSave.

The Australian reported in June that Sigma Healthcare had reached a $2bn pharmaceutical drugs deal with Chemist Warehouse.

The deal provided a 10.7 per cent stake in Sigma to Chemist Warehouse that bound the wholesaler and retailer.

Under the deal, Chemist Warehouse had the right to purchase certain non-core assets from Sigma, which have a value of $24.5m.

Sigma had already supplied consumer goods to Chemist Warehouse to the value of around $1bn a year, and the new drugs deal was to result in its revenue generated by the nation’s largest pharmacy chain rising to $3bn a year.

The Australian reported in October that Chemist Warehouse, which is controlled by founders Jack Gance and Mario Verrocchi, made a net profit of $302m for the year to June, down 22 per cent from the $385m it made a year earlier. 

Revenue reached $3.09bn, compared to $2.99bn in 2022.

A $250m increase in cost of sales on the CW Group Holdings balance sheet was the main reason for the difference in net profit.

Market sources on Wednesday anticipated that the $350m was step one for a deal that could take some time to eventuate, with regulatory approvals potentially needed to occur that could take months, such as the Australian Competition and Consumer Commission.

Luxury fashion retailer Oroton Group says its profit more than tripled on the back of higher sales and stricter cost and inventory management in FY23.

The company booked a net profit of $8.2 million in the 12 months ended July 30, up 3.5 times from last year. 

This comes amid a 25 per cent growth in overall store sales, with same-store sales up by 12 per cent, attributed to investment in in-store experience, additional trading days, and a return to physical retail after the peak of the COVID-19 pandemic. Online sales grew 3.4 per cent.

During the year, Oroton opened stores in Paddington and Mosman in NSW, and at Claremont (WA), along with a pop-up store at Melbourne International Airport.

“Our customers are responding well to our revamped digital channels and quicker and more reliable fulfilment, along with more targeted and relevant content and communication,” said Jennifer Child, CEO at Oroton. 

Oroton has also expanded its efforts to offer more sustainable fabric options including plant-based leathers.

“Oroton customers prize quality over quantity and they are increasingly conscious of their impact on the world. We see huge potential value in offering customers new ways to rent, reuse and resell Oroton apparel and accessories to extend their life and enjoy more variety with less environmental impact,” said Child.

The company expressed confidence in business to go through more challenging macroeconomic conditions ahead.

Wardrobe essentials like basic tees, socks and boxer briefs flew off the shelves at Japanese fast fashion giant Uniqlo, which opened nearly 10 new stores over the past year as budget-conscious Australians chased value for money in their purchases.

Uniqlo’s Australian business saw sales revenue lift 35 per cent to $570.2 million for the 12 months to August 31. However, this was offset by hefty increases in wages and other expenses, which saw net profit come to $31.7 million, a 1 per cent dip on the year before.

Uniqlo Australia chief executive Fuminori Adachi said that growing in the Australian market was a priority for the brand, which is why it invested in marketing, new store openings and design collaborations in the 2023 financial year.

“Our essential wardrobe items, which incorporate technology for ultimate comfort and functionality, continue to resonate with Australians, and we’ve seen popularity with some of our key products and categories, such as our AIRism range, premium linen, high-quality core T-shirts, 50 colourful socks and our boxer briefs,” said Adachi.

Uniqlo’s national store footprint is now 36, after opening new stores in Westpoint Blacktown, Erina Fair, Lakeside Joondalup, Pacific Epping, Bankstown Central, Macarthur Square and Myer Centre Rundle Mall, its first store in South Australia.

“The store openings were very exciting for me to see in Australia, and we felt so welcomed by customers in each local community,” the CEO said.

While sales increased, Uniqlo’s wages bill jumped 56 per cent to more than $127.7 million. Marketing costs lifted 41 per cent to $12.3 million, admin expenses climbed 35.9 per cent to almost $46.9 million, and financing costs more than doubled to $7.6 million.

“We are focused on controlling costs to pass on the best value to our customers. Being a Japanese company, we value long-term partnerships with our suppliers and work closely with them in terms of cost optimisation,” said Adachi.

Online beauty retailer Adore Beauty shares surged 20 per cent on Monday after it knocked back a $122 million takeover proposal from UK-based e-commerce and retail business THG.

The Australian company founded by Kate Morris and James Height, who together control 21.67 per cent, confirmed on Monday that it had received a non-binding indicative offer from the Manchester-based firm, which was first reported by Street Talk. 

Adore shares rose 20.9 per cent, or 19.5¢, to $1.13 on Monday afternoon. The offer range was about a 50 per cent premium to the share price of 82¢ on October 11 when Street Talk reported the appointment of UBS.

“Adore Beauty confirms that it received a non-binding, conditional and indicative proposal from THG … to acquire 100 per cent of the shares of the company by way of a scheme of arrangement for $A1.25-$1.30 cash per share,” the company said.

Adore said the proposal, which was subject to conditions including due diligence, “undervalued the company, was unable to be implemented, and was not in the best interests of shareholders. For these reasons, the board rejected the proposal.

Shopify’s global merchants achieved record sales of US$4.1 billion during Black Friday, a 22 per cent increase over last year’s period.

The top selling countries were the US, the UK, and Canada, while the average cart price was US$110.71 globally, the data shows. The top product categories by orders included clothing, personal care, jewellery, shoes, and decor.

In Australia, the cities with the highest sales were Melbourne, Sydney, and Brisbane. The country’s average cart price was AU$165.70, while the top five product categories consisted of clothing, personal care, kitchen & dining, shoes, and jewellery.

“Another epic, record-breaking Black Friday in the books for Shopify merchants. The world showed up for our merchants, and the excitement is only building, with Cyber Monday still to come,” said Harley Finkelstein, president of Shopify.

Shopify says it will provide another update after Cyber Monday concludes. 

Bunnings is the retailer 2500 Australians surveyed by KPMG believe offers the most excellent customer experience.

KPMG surveyed more than 20,000 people globally and over 2500 in Australia asking which brands deliver the best customer experience.

The Body Shop ranked second while Mecca landed third among the top 10 Australian non-grocery retailers, followed by Specsavers and Chemist Warehouse.

“In the retail sector, the digitisation of customer journeys across channels has been a differentiator that has helped move the bar for customer perceptions in Australia,” said Carmen Bekker, partner-in-charge at KPMG customer.

“Leading brands have been able to integrate these digital journeys with in-store experiences, recognising many Australians have retail journeys that begin online but also include an in-store touchpoint.” 
 

The report noted that customers generally are seeking more value for money, along with more seamless, omnichannel processes and more personalised experiences from brands.

“We see customer perceptions of value formed by how they feel about service and support. It is also formed by how organisations demonstrate their purpose, relevance, and ability to have a positive long-term impact on the environment and society,” said Bekker.

The Iconic, Bendigo Bank, Dan Murphy’s, Apple, and JB Hi-Fi are also featured in the top 10.

The study found that customer perception of experience excellence fell 3.8 per cent across all markets and that 61 per cent are willing to pay more to a company seen as ethical or giving back to society. Almost all respondents – 97 per cent – said the cost of living has impacted their recent purchasing decisions.

Propel Group is selling its water-resistant coat and apparel brand Driza-Bone to billionaire mining magnate Gina Rinehart via her S Kidman and Co pastoral company. 

The deal, whose value has not been disclosed, marks Rinehart’s foray into fashion retail. 

Driza-Bone, acquired by Propel Group in 2008, was merged with country apparel retailer RB Sellars in 2017. The brand marked its 125th-anniversary this year.

“We will bolster Driza-Bone’s expansion strategies, enabling the brand to venture into new international markets while staying true to its Australian heritage and commitment to superior quality,” said S Kidman & Co chief executive Adam Giles.

“The Driza-Bone brand is synonymous with the spirit of the Australian bush. We are committed to upholding and nurturing Driza-Bone’s legacy of Australian craftsmanship while also propelling it to new heights.”

Clothing, footwear and accessories monthly turnover has dropped by $30.6 million in October 2023, Australian Bureau of Statistics (ABS) data revealed.

Overall sales in fashion for October were $2.98 billion, down from $3.01 billion in September 2023. Compared to October 2022, fashion sales have fallen by exactly $20 million. 

Department store sales have also dropped by $12 million to $1.90 billion in October 2023, however, the sector is up by around $8 million compared to October 2022.

Overall Australian retail turnover fell 0.2% to $35.76 billion in October, following a rise of 0.9% in September and a 0.2% rise in August. 

"Retail turnover fell in October after a short-lived boost in spending in September,” ABS head of retail statistics Ben Dorber said. “Turnover was down in all retail categories except food retailing [up 0.5%].

“It looks like consumers hit the pause button on some discretionary spending in October, likely waiting to take advantage of discounts during Black Friday sales events in November. This is a pattern we have seen develop in recent years as Black Friday sales grow in popularity.” 

Retailers will now be banking on a windfall from the Christmas sales period, according to the National Retail Association (NRA).

“The decline in spending, despite the Halloween discount buzz, indicates shoppers are being more conservative about where they spend their money, and the RBA’s snap decision to raise interest rates in November was ill-advised,” NRA director Rob Godwin said.

"We implore the new RBA Governor Michele Bullock to hold interest rates in December to give retailers a fighting chance this Christmas. 

“Consumers can expect competitive bargains to ramp up in the 12 days before Christmas as retailers pull out every trick in the book to make up for a flat year of sales.”

Victoria experienced the biggest decline in retail sales at 0.8%, while Queensland experienced a 0.6% sales boost, which NRA claim could be attributed to the record number of cars sold across the state in October.

However, despite the monthly drop, overall retail sales lifted by 1.2% year-on-year, up $421 million from October 2022.

Australian Retailers Association (ARA) CEO Paul Zahra said this yearly positive lift is mostly attributed to spending on essentials such as food. 

“Shoppers are increasingly feeling the crunch of the cost-of-living crisis and interest rate increases, making it a challenging time to be a discretionary retailer,” he said.

“October’s underwhelming results also came amid the Reserve Bank of Australia’s last interest rate pause. We expect retail sales will be impacted even more by November’s interest rate hike.” 

Zahra said retailers will be watching for November’s retail trade results with interest, given the prevalence of this year’s Black Friday sales.  

“Black Friday has been forecast to be record-breaking this year, with shoppers desperate to cross off their Christmas wish-lists during the biggest pre-Christmas sale event of the year, which is likely to impact December’s numbers. 

“Retailers and Australians will be anxiously awaiting the RBA decision next week, which will affect the final few weeks of Christmas spending. 

“Whilst much has been said about the cost-of-living crisis, retailers are also experiencing a cost of doing business crisis and will be concentrating on offering the best service and value for budget conscious shoppers during the all-important Christmas trading period.” 

Retail sales rose 2 per cent year on year to $35.87 billion in September, Australian Bureau of Statistics (ABS) data showed.

The data prompted both the Australian Retailers Association (ARA) and the National Retail Association (NRA) to urge the Reserve Bank of Australia to keep the current interest rates to encourage more consumer spending.

“The Reserve Bank of Australia’s monetary decision [tomorrow] will be pivotal to the success of retailers during the most important trading time of the year – and we urge the RBA to hold interest rates considering this,” said ARA CEO Paul Zahra.

ABS data revealed that cafes, restaurants, and takeaway sales rose 6.1 per cent to $5.45 billion while food sales jumped 3.5 per cent to $14.16 billion.

“Food and takeaway again led the spending growth, and this is consistent with what we’ve seen all year – shoppers are prioritising the essentials in a cost-of-living crisis,” said ARA CEO Paul Zahra. 

Other retailing composed of recreational, sporting goods, and cosmetics rose 1.6 per cent to $5.5 billion, while department store sales went up 1.3 per cent to $1.92 billion. Clothing, footwear and personal accessory sales inched 1.1 per cent higher to $3.02 billion.

“Pausing interest rates again this month will allow consumers to spend more freely during the November/December sales period and will set retailers up for the coming silly season,” said NRA deputy CEO Lindsay Carroll.

“We hope consumer sentiment increases as retail’s biggest sales season approaches, resulting in a positive start for retailers moving into 2024.”

One of Australia’s biggest retailers, Cotton On, backed by billionaire Nigel Austin, is advancing its international push after opening more than 100 overseas stores last year.

The Australian market still makes up over half of group sales, which reached a record $2.2 billion, up 4 per cent, over the 2023 financial year across its various brands including its namesake chain, Typo, Supre and Rubi, according to accounts lodged with the corporate regulator.

The Geelong-based fast-fashion behemoth’s bottom line was dented by higher rent and finance expenses, as well as a jump in materials costs and wages over the year to June 25.

Net profit was just $5.9 million, reduced from $114.2 million in 2021-22, the accounts of parent entity COGI Pty Ltd showed.

Sales growth in Australia was strong, up $53 million to $1.2 billion. North America achieved sales exceeding $401 million, Africa $183 million and Asia – retail and wholesale – $274.8 million. 

After stripping out $56.6 million in dividends, retained earnings were $189.5 million at balance date.

During 2022-23, Cotton On increased its offshore retail footprint by 15 per cent. The group also invested in new distribution facilities.

“International expansion remains a key strategic priority for the group, in line with our vision to take Aussie lifestyle brands to the world, delivering good along the way,” the account said.

Cotton On’s borrowings reached $326 million, up from $215 million.

The company also rejigged its operating model into two primary divisions: Cotton On, which includes Cotton On, Kids, Body and Rubi; and Emerging Brands, which includes Factorie, Typo, Supre and Ceres Life.

Cotton On was founded by Tania Austin and her former spouse Nigel Austin, starting with two stores in 1991 to 1500 stores today across eight brands in 22 countries. Ms Austin left the business in 2008, and bought retailer Decjuba.

Mr Austin, who landed at no.65 on The Financial Review Rich List with an estimated fortune of $2 billion, is notoriously private.

Womenswear brand Forever New is opening three flagship stores in Kuwait as part of its strategic partnership with fashion conglomerate Apparel Group.

The collaboration will also expand Forever New’s online presence to 6thStreet.com in the UAE.

Founded in Melbourne in 2006, the brand is known for its wearable and timeless collections that celebrate modern femininity, with over 400 retail and concession stores globally and over 30 million visitors to its websites each year. 

“We’re proud to partner with the Apparel Group to further expand our presence in the Middle East,” said Dipendra Goenka, CEO of Forever New.

“With extensive omni-channel capabilities and a strong focus on the customer, the Apparel Group will help deliver an exceptional shopping experience for our Forever New customers in Kuwait.” Neeraj Teckchandani, CEO of Apparel Group, said the partnership reflects the group’s commitment to elevating the fashion landscape in the GCC.

“Forever New’s timeless elegance and contemporary designs are a perfect fit for our market, and we are confident that the brand will be warmly embraced by our customers.”

Furniture retailer King Living is expanding its footprint into North America, opening its first US showroom in Orange County, California late this year.

“After decades of research, we’ve crafted a space that aims to both inspire Californian residents as well as reflect our inherent dedication to authentic Australian design,” said King Living founder David King.

The new showroom will feature sofas, luxurious dining ranges, contemporary bed and mattress ranges, and outdoor collections.

The company intends to open a second US showroom in Chicago, followed by a second showroom in Canada – in Calgary – next year.

“The US is key to the King Living global expansion strategy and the market provides us with an unapparelled growth opportunity,” said David Woollcott, CEO at King Living.

The Australia-headquartered company said the success of its stores in New Zealand, Singapore, Malaysia, Canada, the UK and China was a key factor in its decision to expand into the US.

“This isn’t about growth for growth’s sake, this is about our belief that we will improve the lives of customers who choose our furniture; we are passionate about bringing our designs and our engineering to those who appreciate the King Difference,” said Woollcott.

Sheike has partnered with Australian fashion designer Mariam Seddiq to launch a limited-edition capsule collection.

The 16-style collection features a range of eveningwear garments that took around seven months to complete. It is currently sold online at Sheike, with curated ranges in 16 stores and three stores offering the entire range.

According to Seddiq, it is the first time Sheike has done a collaboration with an Australian designer.

“They initially asked me in October last year,” Seddiq said. “So it's been a long time coming, but we didn't actually start anything until late February. I designed the collection, and then we had a meeting, and then away they went.”

As part of the process, Seddiq requested Sheike to include sizes 18 and 20 for the range.

“I've just taken all my knowledge from every single body shape that I've worked with, and mixed it up and put it in this collection,” she said. “Because the thinnest woman and the curviest woman will have similar insecurities. My job is to make them confident and just hide those bits strategically and just make them feel more sexy.

Sheike head of design Marie Ektoras said conversations on collaborating with an Australian designer have always circled the business. She said the Seddiq collaboration had a freestyle approach without the restrictions to corporate guidelines.

“It feels like a more creatively authentic process,” Ektoras said. “We wanted to include Mariam’s signature silhouettes that her devoted clients love. We’ve injected colour to keep it fun whilst also offering a sleek, moodier vibe.

“It was also important to Mariam to include a size 20 and we too saw this as an opportunity to broaden our size curve.”

Seddiq said the design process with Sheike was a completely different model to how she designs her own collections.

“We don't cut until the order is placed,” she said. “And depending on if it's ready-to-wear or custom - like made-to-measure - they would get a ready to wear piece and we'd cut it to their size, and that is like a two week to a month turnaround, depending on what it is. Then there's custom, so they'd have fittings, and that is longer. So that would be equivalent to the Sheike production time.

“But, in saying that, we've made pieces for celebrities in a day."

The designer praised the collaboration process with Sheike, noting the similarities between both enterprises.

“I'm going to miss going into their offices, because everyone's super professional, but they're also fun. We have fun when we do stuff, but we're also quite prompt as well.

“It didn't feel like work. I didn't have to compromise anything. They just loved everything I created.

“The hardest part was to cull the designs, because it's not entirely my show. It needed to be a capsule collection, rather than… you know how I do the 42 looks for Fashion Week?”

Ektoras said Sheike has another collaboration in the pipeline that will be launched at the beginning of next year.

Auto parts and outdoor equipment retailer Super Retail Group saw a slight like-for-like sales growth in the first 16 weeks of FY24 on the back of higher sales of Supercheap Auto and BCF.

The group booked a 2 per cent like-for-like sales growth during the period as compared to the same period a year ago. Supercheap Auto sales rose 4 per cent while BCF sales jumped 3 per cent.

“Supercheap Auto’s performance has been driven by ongoing strength in the auto maintenance category, including higher lubricant sales following a successful best performing oils campaign,” said Anthony Heraghty, CEO and MD at Super Retail Group.

“Accelerating sales growth in BCF has been supported by contribution from new stores and increased demand in boating, fishing and water sports.”

Sales of Macpac, however, fell 8 per cent, attributed to unseasonably warm weather that affected the sales of insulation and rainwear products. 

Rebel, which is poised to open a new store at Emporium, Melbourne before Christmas, posted zero sales growth. 

Super Retail Group has opened six stores year-to-date in FY24 and remains on track to open 24 stores during the year.

The group plans to spend $150 million in capital expenditure in FY24 for its store development program, a new national distribution centre at Truganina, improvement of customer loyalty programs, and enhancement of cyber, omni and digital capability.

Kogan has logged a 6.5 per cent year-on-year decrease in gross sales for Q1 of FY24, but recorded quarter-on-quarter growth for the first time since the first quarter of FY22.

Kogan is a portfolio of retail and services businesses that includes Kogan Retail, Kogan Marketplace, Kogan Mobile, Kogan Internet, Kogan Insurance, Kogan Money, Kogan Cars, Kogan Energy, Dick Smith, Matt  Blatt, Mighty Ape in New Zealand, and Brosa. 

The company’s gross sales were down to $189.2 million following the significant reduction in inventories.

However, the return of quarterly sales increase signifies that the planned period of consolidation within the firm has concluded. 

“This most recent quarter has been full of excitement for Kogan.com. In addition to returning the business to a position of continuous profitability growth and financial strength, we’ve been busy delivering new ways to delight our customers,” said founder and CEO Ruslan Kogan.

Gross profit of $37.4 million increased 19.5 per cent, with adjusted EBITDA of $8.0 million, demonstrating the sustained return to profitability.

The company recorded more than 2.8 million active customers as of September 30, while subscribers of its loyalty program increased to over 440,000.

“We are confident that the incredible deals we have lined up over the coming months will help in these tough economic times, as we continue to deliver on our promise of making the most in-demand products and services more affordable and accessible,” Kogan stated.

Teen fashion brand Pavement has exclusively relaunched at Big W stores across Australia as it seeks to provide budget-friendly clothing options to the youth market.

“We are thrilled to reintroduce Pavement to the Australian market, especially during these challenging times. Our brand’s ethos revolves around providing our young people with clothing that empowers them to showcase their personalities,” said Brooke Norton, divisional general manager at Designworks, the new owner of Pavement.

In 2020, Pavement entered voluntary administration as it struggled with the impacts of the Covid-19 pandemic.

“With our exclusive partnership with BIG W, we’re ensuring that style-conscious teenagers across the nation can access on-trend and affordable outfits that reflect their individuality,” said Norton.

Pavement collaborated with gymnast and actress Jada-lee Henry for a brand campaign. 

“Big W is thrilled to be partnering exclusively with Pavement for its comeback into the Australian market. We know Aussie families are constantly looking for affordable, quality fashion pieces and BIG W is excited to expand our clothing offering to meet these needs,” said Lowri Breed, head of commercial at Big W.

Australian bag brand Strand has launched a new standalone brand called AYA (“as you are”).

The new brand targets the youth segment, between ages 18-25, with the initial range consisting of over 10 styles and colourways, including handbags, mini bags, crochet totes, cross body bags, bowling bags, diamante clutches and luggage. 

According to Strand, the AYA brand will produce two collections a year - one in late summer and another in mid-Spring, alongside small drops in May and December.

Prices range from $39.99 to $79.99, with a suitcase priced at $250.

The new brand launch comes a year after Strand launched its now growing standalone brand Nere, with Nere's first store openings announced in both Australia and the United Kingdom.

“Off the back of our success in the ‘fashion travel’ category, we have created a spirited brand that is authentic, playful and celebrates individuality- at an accessible price point,” CEO Felicity McGahan said. “We are confident AYA will connect positively with the Gen Z customer.

“AYA celebrates the freedom of showing up as your true self, the collections encourage experimentation with self-expression. At its core AYA is an authentic, playful and versatile brand, promoting a sense of individuality and an evolving personal style.”

AYA has launched via a separate tab on the Strand website.

Outgoing Myer chief executive John King has stared down the threat of Solomon Lew marching up the department store’s share register and says it would be “very silly” to recast the company’s strategy “and start again”.

Mr King’s comments came as he outlined a 12.5 per cent rise in sales and jump in profit for the 12 months to July 29, and after Premier Investments, a vehicle controlled by Lew, increased its stake in Myer from 25.8 per cent to almost 29 per cent last month.

Mr Lew, a long-time activist for change at the department store, was widely expected to push for a second seat on the Myer board. On Thursday, however, a Premier spokeswoman said that the company had not nominated a director for the upcoming annual meeting on November 9.

At the same time, the billionaire has engaged UBS to work through a potential restructure of Premier, which could include splitting off its popular Smiggle and Peter Alexander brands. The restructure, and Premier’s growing stake in Myer, has led to heightened speculation that the businessman wants to bring the department store into the group and link it with its heritage fashion brands such as Jay Jays and Dotti.

Premier non-executive director Terry McCartney already sits on Myer’s board. In 2017, Mr Lew failed in his attempt to appoint Mr McCartney, former UBS banker Tim Antonie and former Federation Centres chief executive Steven Sewell to the Myer board.

On Thursday, Myer said it had met its full-year guidance for sales growth of 12.5 per cent to $3.36 billion, and comparable sales – which excludes periods when stores are closed for refurbishments – improved by 3.3 per cent. But earnings were flat at $400.5 million. Net profit before restructuring, site exit costs and impairments was up 18.2 per cent to $71.1 million, the best bottom line since 2015. Statutory net profit reached $60.4 million, up 23.3 per cent.

Sales were down 1.9 per cent in the first six weeks of the new year, while CBD stores remained in positive territory – up 2 per cent – Myer said.

Myer will pay a final dividend of 1¢ a share, down from 2.5¢, on November 16. Annual dividends were 9¢ a share.

Cultural differences

Asked if Australia had room for two department store chains – Myer and David Jones – Mr King told The Australian Financial Review: “It depends on the size of the space and how they operate. You know, we’re fine. We’re probably stronger than they [David Jones] are at the moment. We’re just focused on our game. It’s very different to theirs.”

Mr King added Premier was a supportive shareholder and Myer’s strategy, known as the customer first plan, was successful.

“It would be very silly if someone would come in and rip that out and try and start again. It’s embedded in the culture of the company,” he said.

In an investor call, businessman Michael Saba expressed concern over any changes in culture and staff under new ownership.

“Just want to thank you and the whole team for achieving awesomeness. We think you have provided some of the greatest stability in Myer’s history,” said Mr Saba, the founder of Swisse Vitamins. “What will make us ensure that our good friend Solomon Lew’s culture will not override what has been achieved, and what has been proven and tested since you’ve taken the helm?”

Mr Saba, who was against Mr McCartney joining the Myer board last year, said he appreciated Premier, but did not “necessarily agree with every aspect of the way they live”.

Mr King told investors that the company’s turnaround program – which involved reducing store sizes, store closures and cutting brands – had yielded significant improvements to the business over the past five years, and he was leaving Myer in good shape, with $120 million of cash.

Mr King is banking on the growing base of younger shoppers joining its Myer One loyalty scheme, and said he was confident introducing brands owned by The Country Road Group would drive sales this year to offset the consumer slowdown. Myer One added 120,000 members in 2023, up 21 per cent. It has 7.3 million digital members, including 4.2 million active members, meaning those who purchased in the past 12 months.

Mr King said a younger demographic was engaging with the Myer One program, and partnership programs with Virgin and Commonwealth Bank were another opportunity to improve loyalty.

But the company was unable to replicate its solid start to the 2023 financial year, as sales in the second half ground to a halt. Mr King said Myer would not chase unprofitable sales. “We will always protect the bottom line. We think that with the CBD stores there is an opportunity where there are more tourists. There’s a lot of people getting back into travelling again.”

Mr King said consumers started significantly pulling back on spending in the June quarter, but Myer’s range meant it was well-placed to meet any budget.

Myer is also beefing up security in store and using more technology to battle higher theft rates, which rose to 1.8 per cent of sales from 1.3 per cent a year ago. This equates to a further $16 million in lost stock, taking shrinkage to $47 million for the year. “It’s definitely way worse than it was before COVID,” Mr King said about theft. “We’re starting to see some improvement.”

The department store has hired Egon Zehnder to find a successor for Mr King, who plans to leave next year. A search for a new chief financial officer is also under way after Nigel Chadwick flagged his departure early next year.