SYDNEY–Australia’s largest department store group Myer said Friday it will return to the Australian stock market before Christmas with an initial public offering that analysts anticipate will be worth 2 to 3 billion Australian dollars, or $1.7 to $2.6 billion, pending market conditions.
The ipo comes three years after the Coles Group sold Melbourne-based Myer to a consortium led by US private equity group Texas Pacific for 1.4 billion Australian dollars, or $1.2 billion. The company did not provide any further information on pricing or the size of the offer. An ipo prospectus is due to be lodged with the Australian Securities and Investments Commission (ASIC) on approximately Sept. 28.
There are signs that the ipo market for retail companies might be starting to pick up- albeit slightly. Earlier this week, Italy’s online discount retailer Yoox said it is pushing ahead with its plans to list on the stock market in the first half of next year. Originally the Bologna-based company had planned to go public this year.
Myer announced the ipo plans while unveiling better-than-expected full year results. Net profit for the year ended July 25 rose 14.8 percent to 109 million Australian dollars, or $94.23 million, higher than originally forecast.
Earnings before interest and tax were up 10.6 percent to 236 million Australian dollars, or $204 million, slightly above previous full-year guidance.
Full year sales declined 1.8 per cent to 3.26 billion Australian dollars, or $2.82 billion, from 3.32 billion Australian dollars, or $2.87 billion, in 2008.
Chief executive office Bernie Brookes said in a statement that sales continued to improve quarter by quarter during fiscal 2009, with second-half like-for-like sales up 0.4 per cent and fourth-quarter like-for-like sales up 3.7 per cent, against the backdrop of a tough retail trading environment, which saw retail sales and housing finance commitments fall slightly in July after the initial impact of the Federal Government’s fiscal stimulus program began to wane.
The company said it expects its fiscal 2010 sales to grow 3 percent and its earnings before interest and taxes to increase about 10 percent, assuming current trends continue.
“We acknowledge that we still have some way to go to reach international best practice. Many of the benefits of our improved retail platform are yet to be realized and I am confident that we now have the foundations in place to start delivering top line growth in [fiscal year 2010] and beyond,” Brookes said. “As we head into the final stages of our 50-month plan to turnaround the business, we have a world class supply chain, a vastly improved technology platform, a more flexible and tailored merchandise strategy, a well motivated and incentivized team and a strengthened product offer”.