Myer’s deputy CEO is out, and the company is downgrading its profit guidance

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Myer has announced deputy chief executive Daniel Bracken will leave the company, as it blamed poor trading conditions for a profit downgrade.

Myer had said underlying profit for the fully year would be higher than $69 million. But poor conditions in June and particularly July has meant it now expects profit to come in between $66 million and $70 million.

“The period of the June-July Stocktake sale has traditionally been an important period of profit generation for Myer,” chief executive Richard Umbers said.

“This year we have executed a number of new initiatives to engage our customers, drive foot traffic to our stores and increase average transaction value. These initiatives have delivered positive results and have provided some mitigation against volatile and challenging trading conditions.”

“We are responding to the challenging external environment in a way that preserves the integrity of the New Myer strategy that is built around customer service, engaging retail experiences and wanted brands, while continuing our focus on efficiency and productivity.”

The departure of Mr Bracken is a surprise. The deputy CEO was also chief merchandise officer and chief customer officer, has only been in the role for two-and-a-half years and was, along with Mr Umbers, one of the architects of the Myer’s turnaround strategy, known as New Myer.

Myer also confirmed on Thursday that it will shut its Topshop and Topman concessions after the collapse of the Australian arm of the chain in late May.

Myer said it has been unable to do a deal with the owner of the Topshop and Topman brands, British retail giant Arcadia Group, to keep the concessions trading, and has written down the entire value of its 20 per cent stake in the Australian business, which had been valued at $6.8 million in the latest accounts.

There was also more bad news out of Myer’s fully-owned Sass & Bide retail chain, which has been struggling in recent months. Myer has said it will write the value of the business down by $38.8 million; the business has a book value of $50.6 million in the 2015-16 accounts.

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