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Premier Investment Achieves 26% NPAT Growth in 1H16

Premier Investment Achieves 26% NPAT Growth in 1H16
Premier Investments owns and operates a number of speciality retail fashion chains across Australia and internationally.
Mar 18, 2016 By Kaivalya Kandarpa Tags: PMV

Premier Investment Ltd (ASX:PMV) released its financial results for the first half of FY16, with consolidated NPAT up 25.9%, underpinned by record retail sales growth of 15.1%.

Premier Investments owns and operates a number of speciality retail fashion chains across Australia and internationally.

Smiggle Sales Expanded 46.3%

The investment firm’s Net Profit Before Tax expanded 24.9% to $98.3 million, compared to 1H15. Subsequently, Earnings before Interest and Tax (EBIT) rose 29.7% to $90.7 million and EBIT margin expanded 180 bps to 16.1%.

Total sales increased 15.1% to $565 million and like-for-like sales grew 6.9%, while online sales surged 47.7%. The overall gross margin rose 139 bps despite weaker AUD, as the company successfully implemented various foreign currency hedging policies.

Smiggle global sales were up 46.25% with strong LFL sales in all countries. Peter Alexander sales rose 22.5%, driven by LFL sales growth and new store openings.

The group’s Chairman, Mr Solomon Lew elucidated the results: “This is a high quality result. Sales growth is strong both in store and online, proving again that we are delighting our customers across all of our brands. All of our seven brands delivered positive like for like sales growth, demonstrating the strength of our customer offer in each market.”

Mr. Lew also stated that Peter Alexander and Smiggle are the company’s two growth brands and also anticipates the stationary store Smiggle to become a ‘truly global brand.’

Dividend

Premier’s balance sheet reflected $288.4 million cash on hand plus the equity accounted investment in Breville at $213.7 million.

The board announced an interim dividend of 23 cents per share, up 2 cents per share on previous distribution.

The upbeat announcement sent PMV up 4.4% to $15.4 as at 11:04 AM (AEDT).

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Kaivalya Kandarpa Author: Kaivalya Kandarpa Mar 18, 2016

Kaivalya is an equity analyst and a client advisor at Wise-owl. She specialises in fundamental and technical analysis for large and mid-cap companies. Having completed her bachelor's degree in Business Administration majoring in Finance, Kaivalya has a comprehensive understanding of international stock market movements. She tracks local and overseas markets and compiles analytical reports for various industries.

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