Has sales and earnings growth stalled for Solomon Lew’s Premier Investments?
This question arises from a terse update to the ASX on Monday, which strongly hinted that the company might see a dip in sales and profits for the year ending July 31.
The full-year results will be released on September 25, but on Monday, Premier reported unaudited figures for the financial year showing total sales of $1.60 billion and earnings before interest and tax (EBIT) of $341 million.
This compares to total sales of $1.66 billion in 2022-23, when the company reported an EBIT of $357.9 million.
No further explanation was provided on Monday by the owner of retail chains Just Jeans, Portmans, Smiggle, and Peter Alexander, as well as equity stakes in Myer and the appliance group Breville.
There was also no update on proposals to strengthen ties with Myer or the possible revamp of Premier, which could involve a breakup of chains like Smiggle.
Regarding Smiggle, Monday’s business media reported that the company had sacked its long-time head of Smiggle, John Cheston, for what was described as “serious misconduct,” though no further details were given.
Cheston had been headhunted by retail billionaire Brett Blundy to be the new CEO of the listed fashion accessory group, Lovisa. This occurred in June.
Back in February 2011, John Cheston was dismissed as CEO of fashion retailer Country Road after the company alleged he had attempted to initiate a management buyout of the chain.
At the time, The Sydney Morning Herald reported:
“Sacked Country Road chief executive John Cheston attempted to mount a management buyout of the women’s fashion chain, the company has alleged.
His (Cheston’s) actions were an attempt to ‘undermine’ the company’s owner, South African group Woolworths, Country Road said in Federal Court papers.
“Country Road’s defence, filed yesterday afternoon, also denies allegations of interference and corporate misconduct made by Mr Cheston, who is seeking $6.5 million in compensation from the company after being sacked after just nine weeks in the job.
“The company claims Mr Cheston was ‘guilty of misconduct’ and has suffered no damage because he has a new job as chief executive of Webster Holdings, the owner of fashion labels Jigsaw, David Lawrence, Marcs and Morrissey.”
In late May 2011, Country Road announced it had settled its legal dispute with former CEO John Cheston for $1.1 million.
Five months after Cheston commenced legal proceedings against Country Road in the Federal Court regarding the termination of his employment, Country Road announced on May 29 that the proceedings had been discontinued, and the sum of $1.1 million had been paid to Cheston. Media reports indicated the settlement occurred following mediation.
However, no details have emerged about what happened this time at Premier and Smiggle.