New Myer suits the new man

Incoming chairman Garry Hounsell has closely aligned himself to the New Myer strategy.

Myer CEO Richard Umbers. Picture: Aaron Francis

Incoming chairman Garry Hounsell has closely aligned himself to the New Myer strategy being pushed through by chief executive Richard Umbers, and has called on investors to visit a store or go online to see the fruits of the turnaround plan.

A month before he is set to rise from deputy to chairman of the department store operator, Mr Hounsell issued his first statement to shareholders, asking investors to ignore the criticisms levelled at the retailer by disgruntled major shareholder, retail billionaire Solomon Lew.

“You may have read recent criticisms of Myer in the media.

“As your incoming chairman, I would encourage you to visit our stores and shop online to see for yourselves how New Myer is being delivered,” Mr Hounsell said in a message that included a notice for the AGM.

“I am convinced that the New Myer strategy is the right one.

“Analysis of Myer’s results relative to others in the apparel sector demonstrates the strategy is working, but it is a difficult environment and in my experience transformation takes time.

“Nevertheless, I am impatient for a return to growing profits.’’

Mr Hounsell said he backed the New Myer strategy, and added that the Myer board had played a central role in developing the New Myer agenda and overseeing its implementation. “The evidence to date demonstrates that underlying earnings have been stabilised and our competitive position has been strengthened, but there is much more to do. “

The New Myer strategy was launched by Mr Umbers in 2015.

Meanwhile, the annual report, which was also released yesterday, reveals Mr Umbers took a slight pay cut in 2017.

His total remuneration slipped to $1.744 million from $1.896m in 2016, as the department store ­operator booked its worst profit result since its sharemarket float in 2009.

Mr Umbers did not lift his pay at a time when Myer saw its net profit slump 80.3 per cent to $11.9m — its lowest profit since it listed in 2009.

Mr Umbers’ cash salary stayed flat at $1.18m while a mix of short-term and long-term incentives delivered a total remuneration that was below 2016’s levels.

The report shows Mr Umbers missed out on short-term incentives that in 2016 rewarded him with $375,655.

Daniel Bracken, his former deputy CEO and co-architect of his New Myer strategy, was paid $1.08m in 2017, down from $1.472m in 2016.

He left Myer after its shock profit warning in July.