Shares of Premier Investments Limited (AU:PMV) plunged today after the company flagged retail struggles in its first half of FY25. The company stated that retail conditions have remained tough in 1H25 with its customers facing cost-of-living pressures across all its global markets. Following the announcement, Premier Investments shares fell by almost 16% on Monday.
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Premier Investments owns and manages a range of retail and wholesale enterprises across Australia, New Zealand, Singapore, and the UK.
Premier Investments Flags Difficult First Half
For the first half of FY25, Premier expects its global retail sales to range between AU$855 million and AU$865 million, down from AU$879.5 million in the same period last year. Meanwhile, the company’s Australian sales will remain mostly unchanged compared to the previous year.
Additionally, it expects its underlying EBIT (earnings before interest and tax) to fall between AU$160 million and AU$165 million, as compared to AU$209.8 million a year ago.
Despite these headwinds, the company expects to finish the first half with a well-managed inventory. The company further stated that it is on track to merge its Apparel Brands business with department store chain Myer Holdings (AU:MYR). In October, Myer announced its agreement to acquire Premier’s Apparel Brands business in Australia and New Zealand, which includes Just Jeans, Jay Jays, Portmans, Dotti, and Jacqui E. Premier’s board has unanimously advised shareholders to approve the deal at the general meeting scheduled for January 23.
The sale of Premier Investments’ apparel business shows how retail companies are adapting to difficult market conditions. With rising living costs worldwide, businesses may need to rethink their operations and portfolios, leading to more mergers and focused investments to sustain growth.
Is PMV a Buy or Sell?
On TipRanks, PMV stock has received a Moderate Buy rating, based on two Buy and three Hold recommendations. The Premier Investments share price target is AU$32.63, which is 17.5% above the current trading price.
