Annual Report
2022
Contents
Annual General Meeting
The thirteenth Annual General Meeting of Myer Holdings Limited ABN 14 119 085 602
will be held on Thursday 10 November 2022 at 2:00pm (Sydney time).
The AGM will be a hybrid meeting, held in person at the Wesley Conference Centre –
220 Pitt Street, Sydney NSW 2000, and on an online platform. Shareholders attending in person
will be able to vote and ask questions during the AGM. Shareholders attending online will be able
to access a webcast of the AGM, vote and submit written questions. A telephone facility will
also be available to shareholders to ask a question verbally during the AGM.
The online platform can be accessed at:
The 2022 Myer Annual Report reflects Myer’s financial and sustainability performance for the period
1 August 2021 to 30 July 2022. It covers our retail and store support operations in Australia. The Annual Report
is prepared for all Myer stakeholders including shareholders, analysts, customers, suppliers, team members,
and the wider community. Content is based on ASX financial and governance reporting guidelines, stakeholder
feedback, and Myer’s business strategy. Further information is available from myer.com.au.
Acknowledgement of Country
In the spirit of reconciliation, Myer acknowledges the Traditional Custodians of country throughout Australia
and their connections to land, sea, and community. We pay our respects to their Elders past and present and
extend that respect to all Aboriginals and Torres Strait Islander people.
About Myer
1
Myer is Australia’s favourite and most trusted department store, placing customers
first in every decision we make and every action we take. We provide friendly, helpful
service, high quality and exclusive brands, with compelling value.
Myer operates 58 department stores
across Australia, as well as our online
business: myer.com.au, and with our
team members, we are committed to
being Australia’s favourite department
store. Our merchandise offer includes
core product categories: Womenswear;
Menswear; Childrenswear; Beauty;
Homewares; Electrical Goods; Toys and
General Merchandise. The majority of
Myer’s operations are in Australia and
encompass Myer department stores,
sass & bide and Marcs and David
Lawrence. In addition to our Australian
operations, we have a sourcing office
located in Hong Kong. Myer’s online
business is a significant asset that
continues to deliver strong growth,
now representing 24.2% of
total sales.
.
About MYER one
Our loyalty program, MYER one,
has more than six million digitally
contactable members. Members
earn Credits on purchases at Myer
that convert into Reward Cards on
a quarterly basis. For every 1000
points earnt, Members receive a
$10 Reward Card. Further details
about the MYER one program are
available at: myerone.com.au
Myer in the community
Myer has a long-standing history of
supporting local communities and
is proud to partner with more than
60 charities across Australia annually.
Myer’s founder Sidney Myer was a
well-known philanthropist, and it is in
his tradition that the Myer Community
Fund remains committed and focused
on charitable work.
The Myer Community Fund is the
national charity of the Myer Group;
it is a public ancillary fund and
governed by its own Board. The
fund is committed to raising funds
through charitable activities involving
Myer team members, customers,
and suppliers. We believe that by
engaging with and contributing to
the communities in which we live and
work, we can have a positive social
impact, make a lasting contribution,
and help achieve positive change.
In FY22, the Myer Community Fund was
proud to raise over $1.3 million, which
will go towards supporting children
and families in Australia, including
those experiencing family violence.
Funds were directed to our charity
partners including The Salvation
Army, Polished Man and local charity
partners nationally.
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
2
Chairman and CEO’s
Letter
Dear Shareholder,
• NPAT(1) of $60.2 million, an increase of
Taking possession of our National
The FY22 results show we have
emerged from the pandemic a better,
$30.7 million or 103.8% if JobKeeper
support excluded(5) from prior year
stronger and more agile business that
• Statutory NPAT $49.0 million,
is well equipped to meet the demands
5.7% higher than prior year
of today’s consumer.
• Net cash at the end of the period
Pleasingly, despite disruptions from
was $186 million, up $74 million
lockdowns and Omicron, the business
on prior year
showed strong improvement in
sales, profitability, cash generation
and other key measures, as well
as delivering our most profitable
second half in almost a decade,
demonstrating the continuing
momentum being delivered under
our Customer First Plan.
The unique strength of our multi-
channel strategy, with a return
to growth in our Store channel
supported by one of Australia’s
largest and fastest growing online
retail businesses, underpinned by our
leading loyalty program, provides a
solid foundation for future growth.
FY22 Results
Our financial highlights include:
• Final fully franked dividend of
2.5 cents per share declared,
bringing the total FY22 dividend
to 4.0 cents per share.
Momentum of the
Customer First Plan
Our FY22 results demonstrate the
continuing momentum of the
Customer First Plan. We are continuing
to deliver against our Plan to ensure
we remain Australia’s favourite and
most trusted department store
through leading service, improving
our range and offer, and by enhancing
and scaling our online business and
leading MYER one loyalty program.
It also ensures we are operating in
the most productive, efficient, and
• Myer’s best second half net profit
effective way across the business, with
after tax(1) (NPAT) since 2H13
a focus on profitable sales, disciplined
• Total sales(2) growth of 12.5% to
$2,989.8 million; comparable store
sales(3) growth of 15.0%
• Group online(4) sales growth of
34.0% to $722.8 million, representing
24.2% of total sales
management of costs, cash and
inventory, and deleveraging of the
balance sheet.
Some of the key deliverables over the
past year include:
Distribution Centre (NDC) in
Victoria to drive the growth of
our online business; the NDC is
expected to be operational in the
second half of FY23.
Continuing to build a high-growth,
large-scale online business, on
our way to our aspiration to be a
$1 billion+ sales per annum business.
Further unlocking the value of
our MYER one loyalty program
delivering our strongest tag rate
since public listing, significant
acquisition and increased
engagement underpinning the
growth of our business.
Continuing to improve our store
network, with major refurbishments
completed at Toowoomba
and Albury and re-layering of
Chadstone and Fountain Gate.
Adding new brands, including
American Eagle, Simone Pérèle and
Bendon to Myer, with a continued
focus on making the big brands
bigger; more than 30 new and
exciting brands have recently been
added across our Fashion, Beauty,
and Home portfolios.
Agreed to the rollout of new Point
of Sale registers to make customer
transactions quicker and team
member Zebra mobility devices to
provide a higher level of service to
our customers.
(1) Excluding implementation costs and individually significant items
(2) Revenue from sale of goods excluding concession sales and sales revenue deferred under customer loyalty program was $2,340.6 million (FY21: $2,116.5 million)
(3) In addition to the historical definition of comparable sales, stores closed during COVID-19 have been removed from both the current and previous year to
obtain comparable sales. Where a store was closed mid-week, the week in which the store closed has been removed. On reopening, the store has been
included from the first full week of trade. Comparable sales also excludes the 53rd week in 2021
(4) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads
(5) Excluding implementation costs and individually significant items, and after the removal of the net JobKeeper benefit of $22 million post tax ($32 million
pre tax) in 1H21
Myer Annual Report 2022Year in Review 3
“ The Board has continued to work in a collaborative and cohesive way with
the Myer Executive Team to execute the Customer First Plan and deliver
value for all shareholders.”
Myer Chairman, JoAnne Stephenson
“ The FY22 results show we have emerged from the pandemic a better,
stronger and more agile business that is well equipped to meet the
demands of today’s consumer.”
Myer CEO, John King
The Board
Thank you
Following the appointment of
From both of us, and on behalf of the
Non-Executive Director, Ari Mervis, in
Board and executive team, we want to
September 2021, there have been no
thank our shareholders, our wonderful
further changes to the Board. The
team members, our partners and
Board has an appropriate mix of skills,
suppliers – the backbone of our
diversity and experience, is united and
business – and above all else, our
independent, and continues to work in
customers for your ongoing support
a collaborative and cohesive way with
and loyalty.
the Myer Executive Team to execute the
Customer First Plan and deliver value
for all shareholders.
Year ahead and Christmas
Despite the broader economic
uncertainty, we believe that we are
well placed to capitalise on the
opportunities that exist with the right
value-based proposition of affordable
and aspirational brands, a performing
store and online offer underpinned by
a leading loyalty program providing
greater value and choice for our
customers.
In relation to Christmas, we are well
stocked and well planned and, through
our leading Giftoriums and Santalands,
are ready to delight our customers,
providing a true one-stop shop for
everything they need this Christmas.
We will continue to deliver against
our Customer First Plan – it was the
right plan when we started it, and the
right plan going forward, and has
underpinned the growth we have seen
in recent times.
Through the Plan we have achieved
Yours sincerely,
a lot together, but we know there is
more to be done, and we look forward
to continuing to deliver against our
Plan, as well as ensuring a successful
upcoming peak trade period for our
customers.
JoAnne Stephenson
Chairman
John King
CEO and Managing Director
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
4
Performance
overview
While the last few years have been disruptive to our people and our business,
they have created an opportunity for Myer to adapt and grow in the new environment.
The full year results demonstrated how
We are buoyed by the strength of
These results gave the Board
the Customer First Plan continues to
deliver and gain momentum.
our multi-channel capability, with
online sales(2) growing 34.0% during
confidence to declare a final dividend
of 2.5 cents per share, taking the total
Despite the disruptions of government-
mandated lockdowns and the
the period, now representing 24.2%
FY22 dividend to 4.0 cents per share.
of total sales.
Omicron wave, Myer achieved strong
Our focus has remained on the
year-on-year sales growth, which
disciplined management of
translated into increasing profit.
costs, cash, inventory and space
The momentum was particularly
strong in the second half, with the
business reporting its best second
half NPAT(1) since 2H13.
optimisation. Net cash increased
during the year by $74m to $186m
at period end.
Key Financials
$ Millions
Total Sales(3)
Operating Gross Profit (OGP)
Cost of Doing Business (CODB)(1)
2022
2021
Change
2,989.8
2,658.3
12.5%
1,145.2
1,055.7
(745.2)
(665.7)
8.5%
11.9%
2.6%
8.0%
Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA)(1)
400.0
390.0
Earnings before Interest and Tax (EBIT)(1)
184.2
170.5
Net Profit after Tax(1)
Implementation costs and individually significant items (post-tax)
Statutory Net Profit after Tax
Basic EPS (cents)(4)
Basic EPS (cents) – adjusted(5)
60.2
(11.2)
49.0
6.0
7.3
51.7
16.5%
(5.3)
111.2%
46.4
5.7
6.3
5.7%
5.4%
16.3%
(1) Excluding implementation costs and individually significant items
(2) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads
(3) Revenue from sale of goods excluding concession sales and sales revenue deferred under customer loyalty program was $2,340.6 million (FY21: $2,116.5 million)
(4) Based on statutory NPAT
(5) Based on NPAT excluding implementation costs and individually significant items
Myer Annual Report 2022Year in Review 5
Our
Customer First Plan
All Myer team members are continuing to deliver against the Customer First Plan
– providing a leading offer, great value, with the best customer service - ensuring
we remain Australia’s favourite and most trusted department store.
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Customers
Come First
Own Our
Future
Do What’s
Right
One Inclusive
Team
Accelerate online
Accelerate F2C
Adapt in-store experience
Refocus merchandise
Rationalise property
Reduce overheads
Engage the customer
Accelerate online: We continue
to enhance and improve
myer.com.au, as well as making
improvements in the way we
engage and reward customers
through MYER one, with group
online sales up 34.0% to
$722.8 million, representing
24.2% of total sales.
Accelerate Factory to Customer:
We have taken possession of
our new NDC. When operational
(expected in 2H23), this will
ensure we are getting products
to our customers in the quickest
and most efficient way.
Adapt in-store experience: We
continue to improve and curate
our store experience with major
refurbishments at Toowoomba
and Albury, and re-layering at
Chadstone and Fountain Gate;
with space optimisation planned
at a further 17 stores in FY23.
We continue to modernise our
store technology to improve the
customer and team member
experience.
Refocus merchandise: We have
added new brands including
Reduce overheads: We
remain focused on reducing
Simone Pérèle and Bendon
costs and will continue to
and announced that American
proactively reduce space
Eagle will be coming to Myer,
and seek productivity
all part of our ongoing focus on
improvements in our stores
making the big brands bigger.
and at the Store Support
More than 30 new and exciting
Office. In line with this, in
brands have recently been
January 2022 we moved to
added across our Fashion,
our more appropriately sized
Beauty, and Home portfolios.
Store Support Office.
Rationalise property: We
continue to strategically review,
Engage the customer: We
are driving engagement and
optimise and reduce our overall
growth through our MYER one
store space with a view to driving
loyalty base by delivering
greater profitability. Our approach
improved rewards and greater
will seek the appropriate balance
personalisation, and have also
between physical stores and
announced a new partnership
online capability to better serve
with Virgin, under which
our customers. This included the
Velocity members can use
closure of our Knox and Blacktown
points for online purchases
stores, and announced the
at Myer.
closure of our Frankston store
scheduled for January 2023. We
have also handed back space to
our landlords at our Toowoomba,
Chermside and Eastland stores
during the year.
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
6
$722.8MGroup online
sales
representing
24.2%of total sales
Accelerate online
Group online sales were $722.8 million,
up from $208.6 million in FY18 when
we started our Customer First
Plan. Throughout the year we have
continued to improve our end-to-end
online customer experience with
improvements to search, navigation
and filters to help customers find
for Wellness and Travel plus new
brand additions like Skinceuticals
and Chanel No.1. There has been
ongoing work to match our store and
online ranges, with further online only
products available via our marketplace
offering, ensuring customers have
access to one of the biggest online
catalogues in the country.
what they are looking for, and made it
With the ongoing work done to improve
easier for customers to join MYER one
the user experience, our Net Promoter
online and take advantage of exclusive
Score online has significantly improved
MYER one promotions. We have also
continued enhancing checkout to
since the start of our Customer First
Plan. We remain focused on making
make it even easier for customers to
online even bigger and better,
buy and added new payment and
delivery options. We also expanded
whilst being more data driven in our
approach to engagement with our
our pay with points program to enable
customers.
Velocity Frequent Flyer members and
Commonwealth Bank customers to
redeem their rewards for Myer
products online.
We have also renewed our focus
on driving more effective customer
relationship management, trade and
insight led marketing capabilities, while
We have continued to improve the
developing more MYER one member
breadth of our online offering, including
exclusive promotional activity, to foster
launching our new sport category,
which aligns with ‘The Movement at
Myer’ rollout in stores, and new edits
greater engagement and growth.
Myer Annual Report 2022Year in Review Myer Annual Report 2022
Year in Review
7
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Above: Images of
some of the leading
technology that will
deliver widespread
customer benefits
and efficiencies.
Accelerating factory to customer
Myer CEO, John King, said:
We have taken possession of our new 40,000 square metre
National Distribution Centre for both stores and online
fulfilment, which is expected to be operational in the
second half of FY23.
The new build, located at Dexus’
The sortation solution will sort product
‘Horizon 3023’ industrial estate in
by store and/or carrier for cross dock,
Ravenhall, Victoria, is a state-of-the art
store replenishment and online orders.
facility that will hold over 100,000 SKUs,
The P800 AMR will process our hanging
with widespread customer benefits
garments for stores and online. The
and efficiencies anticipated for both
RS8 shuttles are 8 metre high AMR’s
the stores and online business.
with the capability of putting away
The NDC, through leading innovation
and retrieving full product cartons.
and automation, will be the driver and
The design of the NDC is to an
backbone of this important part of our
uncertified 5-star Green Star rating
business, allowing better distribution
and includes water harvesting and
of stock to our stores, delivering
recycling, LED lighting throughout
greater efficiency in inventory
the warehouse and offices, energy-
management, reducing mark down
efficient fittings, water-saving taps
requirements and maximising sell
and fixtures in kitchen amenities and
through.
It will also provide a more efficient
online fulfilment process to enable
delivery of greater profitability and
ensuring we have the future capacity
the use of sustainable materials where
applicable. Solar will reduce the NDC’s
energy consumption by an estimated
20%, with any excess power returned
to the grid.
to meet the growth expectations we
We are currently in the process of
have within the online channel.
fitting out the NDC facility and we
expect it to be operational in the
second half of FY23.
The NDC will feature more than 200
Autonomous Mobile Robots (AMRs)
and boast three different AMR
technologies (Geek+ RS8 Shuttle,
P800s, and Körber’s sortation solution).
It will be the largest Geek+ RS8
shuttle implementation to date in the
Southern Hemisphere.
“ Our NDC will fundamentally
change our supply chain
operations – delivering a faster,
more efficient and profitable way
to meet the demands of our online
business and ensure we maximise
the inventory flow to our stores.
“ This is an important deliverable
of our Customer First Plan and,
importantly, will deliver a better
outcome for both our customers
and shareholders.”
Myer’s Executive General Manager
of Supply Chain, Tony Carr, said:
“ The team were excited to get the
keys to this state of the art facility.
Having an NDC is incredibly
important as it will ensure we
can accommodate the growth
in our online business, as well as
providing the service levels our
customers expect and deserve
from Myer.
“ There are widespread customer
benefits and efficiencies
anticipated for both the stores and
online businesses. It will allow us
to be more data led in stocking
our stores – to allow stores to
draw from the NDC as they meet
demand, not the push model
of old, ensuring we continue to
fulfil the stores more efficiently
to meet customer demand. This
will provide huge benefits to our
business. It will ensure, through
automation, that online purchases
are serviced in an even faster and
streamlined way.”
8
Adapt in-store experience
We have continued with our focus
on improving customer service,
store layouts and the appearance of
our stores as well as our range and
offer. It is this work that has led to us
again recording strong customer
satisfaction results, with our in-store
team members receiving a score of
82%, up from 70% in 1H18.
Myer was again named Department
Store of the Year by Roy Morgan, as
well as being rated as the 8th most
trusted brand in Australia in the Roy
Morgan 2022 Risk Report.
This result reflects the commitment
from all team members to provide
exceptional service, our value
proposition, improvements across the
store network with our brand offer, as
well as making the big brands bigger.
We are continuing to ensure team
members have the technology they
need to service our customers in an
even better way. As part of this, Myer
has embarked on its biggest store
technology transformation in recent
history. The 18-month transformation
will deliver new Zebra TC57X mobility
devices and new NCR point of sale to
all stores.
82in-store team members’
customer satisfaction
score
The Zebra mobility devices will be
rolled out to stores with brand new
applications to conduct activities
such as receiving and dispatch,
stocktake, online fulfilment and
inventory enquiry/pricing, significantly
enhancing team member experience
and delivering multiple process
efficiencies.
The “One Device Strategy” will see all
core business applications bundled
onto the Zebra Mobility device, as well
as new applications such as the Push-
To-Talk which will seamlessly connect
our team members across the store.
We will commence the rollout of
new NCR point of sale registers in
FY23 including the new point of sale
software, providing a significant
uplift to our customers’ experience at
checkout.
This is in addition to our leading
M-Metrics team member application,
which provides real time digital
communications, product knowledge
and performance recognition
delivered direct to our team members.
The app displays customer feedback
and provides a wide range of learning
moments, including video content.
General Manager Retail
Operations, Gary Stones
said:
“ Myer is embarking on our
biggest transformation of
store technology in recent
history, ensuring a better
experience for customers
in store.
“ Our new registers will
ensure simpler and quicker
transaction times –
approximately 20 percent
faster, and through our new
Zebra devices we can provide
on-the-spot assistance with
stock availability, as well as
team members being able
to connect to provide faster
service and assistance to our
customers.
“ We have a commitment to put
customers first in everything
we do, and this step-change
in technology will ensure Myer
remains Australia’s favourite
and most trusted department
store into the future.”
Voice of our customers
Our Voice of Customer program provides our customers with the
opportunity to rate their shopping experience and we have maintained
leading customer satisfaction results this year with our in-store team
members receiving a score of 82%.
Two of our team members who provided exceptional service
to our customers are Nita Govind Vanmali and Rose Errington:
Nita Govind Vanmali
Indooroopilly, QLD
Rose Errington
Marion, SA
Nita received feedback from 100
Rose received feedback from 102
customers, averaging a Customer
customers, averaging a Customer
Service Satisfaction result of 95% for
Service Satisfaction result of 93% for
the year. One of our customers said:
the year. One of our customers said:
“ Very professional, genuinely
friendly. I felt like I was being
spoken to as a long-time friend.
Can’t rate her highly enough.
A real asset to your store.”
“ She was so kind, jumped at the
opportunity to help me, wished
me a happy birthday, helped me
pick out towels. Just a genuinely
positive shopping experience.”
Myer Annual Report 2022Year in Review 9
Store improvements
We are continuing to improve the
customer experience with major
refurbishments at Toowoomba and
Albury and re-layering taking place
at Chadstone and Fountain Gate,
with space optimisation planned at a
further 17 stores in FY23.
These targeted works are aimed at
giving our customers the best possible
in-store experience when shopping
with us.
Myer Albury Store Manager,
Chris Boneham, said:
“ Our refurbished store really
showcases our brands and
extensive offering in the best
possible way - in a modern,
fresh and bright new layout.
The improvements include
new lighting, flooring, fixtures
as well as the removal of
many existing walls to open
up the store, ensuring an even
better experience for our loyal
customers.
“ It was great to officially open
the refurbished store which
demonstrates our ongoing
commitment to our loyal
customers and the Albury
community.”
Myer Toowoomba Store
Manager, Fiona Trevitt said:
“ Our Toowoomba team were
so excited to officially open
our refurbished store to the
community with new lighting,
flooring, fixtures as well as
the removal of many existing
walls to open up the store,
improved change rooms and
entrance upgrade works.
“We are loving showing
customers through the new
store and for them to see, first-
hand, some of the fantastic
new brands we have on offer.”
Refocus merchandise
Myer has recently introduced over
over 30 new brands across its Fashion,
Beauty and Home portfolios, with a
healthy inventory position, ensuring
In womenswear, we have seen the
return of Bendon Group brands,
Bendon, Pleasure State, me.by bendon
and Fayreform, which will establish
Myer’s place as a leading destination
for intimate apparel brands in
Australia. We also launched luxury
Parisian lingerie brand, Simone Pérèle,
into selected Myer stores and online in
February this year.
In a department store exclusive,
leading apparel brands, American
Eagle and Aerie, will land at 40 Myer
stores, progressively from October
2022 onwards, bringing a broad
assortment of high-quality, on-trend
and accessibly priced jeans, apparel,
activewear and intimates.
In menswear, we have launched
British heritage brands Barbour and
GANT, which will roll out to a further
ten stores.
newness for our customers.
In childrenswear, we strengthened our
brand offer with Tommy Hilfiger, Calvin
Klein Jeans, Jack & Jones Junior and
Levi’s, all going to more stores.
We are working with our key brand
partners to cement long-term,
strategic partnerships to drive
commercial success, and as such,
more brands are choosing Myer as
their preferred trading partner. This
is in line with our ongoing strategy
of making the big brands bigger.
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
10
‘The Movement at Myer’, our leading
Sport Fashion, Lifestyle and Technology
offer in Melbourne and Online, includes
popular brands Adidas, Champion,
Puma, Lacoste Sport, Superdry Sport,
the AFL Store, Fitbit, L.I Virtual and many
more. This will be rolled out to 52 stores
in an edited version during Summer 23.
In beauty, Myer has expanded Gucci
Beauty to Parramatta and Perth, as well
as Libertine Parfumerie to Highpoint,
Perth and Adelaide. The Perth beauty
hall has been refurbished with the
beautiful new counter designs,
showcasing the latest from Chanel,
Estee Lauder, Lancôme, Clinique, M.A.C,
Clarins, Benefit and many more. Myer
Melbourne opened global first counters
for Estee Lauder, M.A.C, Bobbi Brown
and Hermès with further exciting new
counters planned to open later this year.
.
Chief Merchandise Officer,
Allan Winstanley, said:
“ Throughout the year, Myer
has cemented its place as the
number one destination for
Australian and international
brands through the reach of
our store network, our leading
online store and our MYER one
loyalty program.
“ We are thrilled to bring so
many new and exciting
brands to Myer this year,
which will continue to
surprise and delight our loyal
customers. Myer is trusted by
Australian customers for our
quality product and brand
offering, experience and
service, and that’s why we are
seeing more and more brands
choose to call Myer home.”
Rationalise property
and reduce overheads
Myer is continuing to reduce space
across the business, with the closure
of our Knox and Blacktown stores
this year and space reductions in
our Toowoomba, Chermside and
Eastland stores. Myer also announced
the closure of the Frankston store,
scheduled for January 2023. In total,
we have exited or announced a
reduction of 119,534 square metres GLA
(11.1%) of space since 1H18, with a further
69,000 square metres in the pipeline.
Reducing costs and ensuring we
are operating in the most efficient
and effective way continues to be a
focus across the business. As part of
this, in January this year, we moved
to a more appropriately sized store
support office, ensuring the best office
environment for our team members,
whilst reducing costs to the business.
Myer named Department
Store of the Year and 8th
Most Trusted Brand
Myer was honoured to have been
announced as the Roy Morgan
Annual Customer Satisfaction
Awards Department Store of the
Year, as well as moving to 8th spot
on Roy Morgan’s Most Trusted
Brands list.
Myer Annual Report 2022Year in Review 11
Engage the customer
The MYER one program provides a key
competitive and strategic advantage
for our business. With 6.6 million digitally
contactable members across our
omni-channel network, the program
enables us to connect with our most
valuable customers to provide relevant,
insight led communications and
experiences, while providing the core
data and insights that underpin the
customer and data first decisions
made across the business.
There has been a great deal of work
undertaken during FY22 to get even
closer to our customers – to understand
what they want to buy, when they want
to buy, and where they want to buy it –
than ever before.
We are using our data and analytics
capabilities, infrastructure and
technology assets and owned channels
more effectively for promotions and
offers, as well as advertising and
marketing, to better engage with our
customers.
Our increased focus on driving MYER one
in-store, and process improvements
to online user and account flows has
seen MYER one engagement (tag rate)
improve significantly in FY22, to its
highest level since public listing. MYER
one sales improved to 71.3% of total
sales, up from 69.7% in FY21, with MYER
one online sales improving to 70.5% of
total sales, up from 66.4% the year prior.
New member acquisition has grown
29.9% year on year, with 593,358 new
members joining the MYER one program
in FY22. Encouragingly, we are attracting
a younger, more affluent and digitally
active customer, with new member
acquisition over-indexing in the
18-34 year age group.
Chief Customer Officer,
Geoff Ikin, said:
“At a time when Australians
are looking to make their dollar
stretch further, Myer has been
building new ways to provide
value to Australians through
our recent partnership with the
Velocity Frequent Flyer program
- an extension of the very
successful CommBank “Pay with
Points” program, and of course
through our leading loyalty
program, MYER one.”
Myer’s future customer growth is underpinned by our growth
in MYER one and new partnership opportunities
71.3%
tag rate
The rate for all purchases in-store and online
is now at its highest level since public listing.
593K
acquired
customers
3.7M
active
customers
We have acquired 593k customers throughout FY22,
mainly in younger demographics.
MYER one had 3.7m active customers in the last
12 months, making it one of the largest active retail
loyalty programs in the country.
New and innovative
partnerships
The continued growth and expansion of our
CommBank “Pay with Points” program and the
newly announced strategic partnership with
Velocity Frequent Flyer will continue to provide new
customer acquisition, revenue, and engagement
opportunities.
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
12
Sustainability
at Myer
At Myer, sustainability is about responsible business growth and development that
considers and addresses the environmental, ethical, economic and social impacts
of our business operations and strategies.
Myer recognises that addressing
The website will be used to release
in Australian communities and
climate change is important to our
information on an ongoing basis and
increasing recycling diversion.
customers, shareholders, suppliers
enable connection and transparency
and team members. Myer continues
with stakeholders, customers and
to be committed to the development
shareholders as Myer continues along
of a Sustainability Strategy, taking
its sustainability journey.
into account business activities
and impacts, as well as stakeholder
concerns and interests.
The Sustainability Strategy has
four primary focus areas including,
Sustainable Packaging and Recycling,
Ethical Sourcing, Sustainable
Merchandise and Energy Management.
Accountability for the implementation
of this strategy is cross-departmental,
with many core business units working
Sustainable packaging
and recycling
Packaging is a key focus of the
Sustainability Strategy, with a
number of initiatives in place across
departments to reduce packaging,
increase the amount of recycled and
renewable content in private label
packaging and implement labelling
regarding recyclability.
During FY22, Myer conducted a
number of packaging reviews across
private label packaging through the
Packaging Recyclability Evaluation
Portal (PREP), which is an online
platform used by organisations to
verify if packaging is or isn’t recyclable
in Australian kerbside collections. From
these evaluations, Myer implemented
the Australasian Recycling Label (ARL)
onto packaging for the first time.
This is an evidence-based system
underpinned by the PREP providing
easy to understand recycling
information. These initiatives assist
together to embed sustainable
Myer remains a committed signatory
with keeping contamination out of
initiatives into business processes
to the Australian Packaging Covenant
the recycling stream and recyclable
and ensuring the values of our
(APC), submitting its 15th Annual
material away from landfill.
stakeholders continue to be met.
Report in March 2022. The APC is a
During the year, Myer launched
its Sustainability web page on its
Investor and Media Centre, providing
customers and stakeholders
information on Myer’s commitments
and initiatives.
national co-regulatory initiative in
place of state-based regulatory
arrangements for sustainable
packaging management, optimising
packaging practices, reducing the
environmental impact of packaging
Renewable sources were also
introduced into private label
packaging, including FSC accredited
materials. In this year’s Action Plan,
Myer has committed to reviewing at
least 90% of packaging with reference
to Sustainable Packaging Guidelines
(SPG) or equivalent and will continue
to embed the SPGs further into
business processes and collaborate
with suppliers for private label and
supply chain packaging.
Myer’s plastic bag initiative, which
focuses on phasing out single-
use plastic shopping bags, has
successfully decreased plastic
bag consumption in stores, with the
total number of units ordered down
4.92 million on FY21.
Myer continues to reduce its waste
sent to landfill, while sustaining
effective re-use systems including
cardboard and paper, less clear
flexible plastics, apparel hangers,
damaged and unsold stock, timber
Myer Annual Report 2022Year in Review 13
pallets and security tags. Myer also
has a Reverse Logistics process
that recycles or salvages products
including hangers accompanying
products. In FY22, total hanger reuse
rate was 63%, equating to 775 tonnes
of CO2 reduced, 2,278,637 litres of
water saved and 259 tonnes of waste
reduced from landfill.
In FY22, Myer’s total waste and
recycling generation remains
relatively stable with a 66.4% recycling
diversion rate. A waste roadmap
is currently under development, to
continue to improve on existing waste
and recycling systems and processes
within Myer’s operations.
Myer’s commitment to reducing waste
goes beyond our operations. During
the year, Myer offered customers a
convenient place to drop off textiles,
cookware and cosmetic packaging
through in-store partnership recycling
trials to support with closing the loop
and preventing these materials from
going to landfill. Myer engaged with
longstanding charity partner The
Salvation Army for the Moving the
Needle initiative. Participating stores
include Eastland, Fountain Gate and
Melbourne, with a plan to expand
into Sydney, Erina and Penrith. Myer
also partnered with Close The Loop to
Adelaide, Parramatta, Bondi,
Suppliers must also ensure that
Macquarie, Canberra, Garden City
workers are provided a safe work
and Indooroopilly. Myer will review the
environment free from discrimination,
results of each initiative at the end of
abuse and harassment, protected
the trial periods to determine whether
against forced or child labour,
they continue in stores permanently.
compensated fairly, and allowed
Ethical sourcing
Myer is committed to sourcing
responsibly and ensuring our sourcing
framework remains relevant and
effective in improving social practices
and protecting worker rights within our
operations and supply chain.
freedom of association and the right
to collectively bargain.
Myer recognises the importance of
understanding and managing the
risks of modern slavery within our
operations and supply chain. Our
approach to managing these risks is
embedded within our Ethical Sourcing
trial a product stewardship scheme
Myer acknowledges its responsibility
Framework and is implemented
for cosmetics in Sydney, Melbourne,
in respecting global standards
through our management and due
Chadstone, Highpoint, Parramatta,
on human rights, ethical business
diligence systems. Myer published its
Adelaide, Brisbane, Perth, Ballarat,
practices and workplace safety,
second Modern Slavery Statement
Albury, Joondalup and North Lakes.
and works with suppliers and
which reports on our progress to
Close the Loop, with support from the
Australian Government, is working
to establish a cosmetic recycling
scheme, initially focusing on cosmetic
makeup products, by developing a
comprehensive collection network
that will collect, process and reuse
or recycle this waste. This support
provides momentum in shifting the
business partners that share our
identify, assess and mitigate the risk of
values of accountability and ethical
modern slavery within our operations
conduct. Our Ethical Sourcing
and supply chains. This Statement
Program standardises our approach
addresses our cross-functional
to ethical business conduct and
approach to address modern slavery
responsible sourcing, and embraces
risks, with accountability across many
internationally recognised labour
internal business units to embed
standards such as the Ethical Trade
ethical sourcing initiatives into
Initiative (ETI).
processes.
industry towards a circular economy
All suppliers and business partners
to ensure higher rates of recycling of
must adhere to our Ethical Sourcing
cosmetic products. A third partnership,
Policy and have management
with internationally recognised
systems covering all factories, which
homeware brand Tefal, is exclusively
must include a requirement
launching a recycling cookware
campaign in selected stores
to recognise the rights of workers,
and treat them with dignity
Melbourne, Chadstone, Chatswood,
and respect as understood by
Miranda, Sydney, Perth, Brisbane,
international community standards.
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review Energy management
Myer is committed to understanding
and reducing our carbon emission
impacts and is exploring sustainable
and renewable energy options.
This year Myer’s total energy use for
the year reduced by 1.4% to 462,664
gigajoules, resulting in 96,838
tonnes of carbon dioxide equivalent
greenhouse gas emissions, which is a
reduction of 4.8% from FY21. The energy
intensity of our business decreased
by 2.7% on the FY21 result. Since the
commencement of the strategy in
2014, we have achieved 36% reduction
in total net company overall energy
use, 44% reduction in CO2 emissions
and 21% reduction in our energy
intensity.
Through store refurbishments,
Myer has commenced LED lighting
upgrades and has recently conducted
a number of store lighting audits to
prioritise which stores will be selected
for future energy efficient lighting
upgrades. Myer’s new Support Office
in Docklands has been rated as a
5-star green design and a 5-star
NABERS energy office rating. Myer’s
new NDC in Victoria has energy-
efficient fittings, solar panels and
LED lighting throughout the building.
As our strategic plan continues to
develop, Myer will continue to focus
on decarbonising through various
emissions reduction initiatives and
will provide updates through our
sustainability web page and annual
reports as our strategy evolves.
14
During the year, Myer continued
to strengthen its ethical sourcing
program with a focus on improving
and implementing mitigation
processes for identified modern
slavery risks. The complexity of
supply chains remain a challenge,
with a primary focus on increasing
traceability and mapping beyond
our tier one supply chain in
progress. Further, we have prioritised
transparency and published a listing
of our private label factories including
their location, number of employees
and the percentage of migrant
workers and women.
Sustainable merchandise
Myer acknowledges customer
demands for sustainable
merchandising and increasing the
offering of sustainable merchandise
remains a key focus of the
Sustainability Strategy. This includes
the ongoing development of products
that have sustainably sourced or
recycled materials, products that are
made ensuring animals are treated
humanely and that no harmful
processes are employed, products
that support specific community
organisations, Australian made or
products of Australia and products
Myer directly sources products from
that are designed to be reusable.
over 300 suppliers across 16 countries
for its private label brands. The major
locations we source from include
China, India, Bangladesh and Vietnam.
During the year we reviewed audits
from 201 suppliers (326 factories)
within our private label network. Our
review identified a zero tolerance issue
where a factory amended an audit
report provided (factory exited) and
The impacts of fibres are reviewed as
part of the design and development
process, with private label teams
focusing on utilising a number of
sustainable alternatives to traditional
fibres, including Certified European
Flax, organic cotton, recycled PET
and recycled nylon, vegan leather
alternatives and Tencel.
64 high-risk issues, which primarily
Work continues to be done to explore
related to excessive overtime hours.
avenues to increase supply chain
We continue to work and support
transparency and further ensure
factories and suppliers to address
certification of sustainably sourced
any non-conformances and
fibres, including cotton and wool.
develop corrective action plans
to achieve compliance.
Myer Annual Report 2022Year in Review Our team
Myer team members are our
most important resource. We
are committed to offering our
approximately 10,000 team members
a supportive, challenging and
rewarding workplace that enables
them to contribute to Myer’s success
and reach their full potential.
Myer aspires to create and maintain
a collaborative and inclusive
workplace to reflect the diversity of
our customers and our community.
The business focuses on three key
inclusion priorities: cultural diversity,
LGBTQIA+ inclusion and female
representation at senior leadership
levels. These priorities form the basis
of our ongoing diversity and inclusion
calendar of programs and events,
as well as communications with
our team.
15
Providing an environment that
behaviour. This program is well-
protects the health and safety of all
supported by our Employee
team members, contractors and
Assistance and Manager Assist
customers has, as always, been an
counselling programs, which have
overriding priority during the year.
been actively promoted throughout
As the COVID-19 pandemic has
the year.
To drive improved safety in our
workplaces, we have focused on
delivering safety management
training to all our team members
and a targeted workplace inspection
program to enhance the identification
and management of commonly
occurring hazards.
continued, our focus has been on
continuing to provide a safe place
for our team members, contractors
and customers to work and shop.
The Myer Group’s workforce
Through the Omicron wave, strategies
composition at 30 July 2022 was 79.5%
were taken to keep our teams
female, with 57.4% of leadership roles
informed about exposures, and
and 50% of our Non-Executive Directors
regular communication with our team
being female. Myer monitors progress
members has been critical in keeping
in female representation through
them informed about any measures
measurable objectives in terms of
being implemented to manage
succession planning, parental leave
associated risks.
and leadership development metrics.
The wellbeing of our team is a key
Our commitment to developing the
priority, and to support our teams with
leadership and capability of our team
managing challenging interactions
was also reflected with the continuation
with customers, Myer has introduced
of Certificate IV in Retail Management,
an online training program which
Merchandise Buyer and Planner in
provides guidance on how to respond
Training programs and Leadership
to and manage unacceptable
training programs during the year.
Sustainability performance and targets
Focus Area
Key Measure
Team
Diversity and inclusion (% female senior managers)
Workplace safety (LTIFR)
Environment Greenhouse gas emissions reduction (%)
Energy intensity (kJ/m2.opening hour)
Recycling rate (%)
Business
Code of Conduct Training
(% of required team members trained)
Improved / met target
Did not reach target
* impacted by store closures due to COVID-19 pandemic
FY20
FY21
FY22
Performance
Performance
Performance
56.5
6.4
9.6
163.1
63.0
88.8
54.9
5.2
6.9
146.7
63.6
57.4
5.8
4.9*
142.7
66.4
87.9
85.6
FY23
Target
≥50
<5.6
≥1.0
≤142.7
≥66.4
≥80.0
Myer Annual Report 2022Year in ReviewDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
16
Directors’
Report
DIRECTORS’ REPORT
Your directors present their annual report on the consolidated entity consisting of Myer Holdings Limited ABN 14 119 085 602 (the
Company or Myer) and the entities it controlled (collectively referred to as the Group) at the end of, or during, the financial
period ended 30 July 2022.
1. Directors
The following persons were directors of the Company during the financial period and / or up to the date of this Directors’ Report:
Director
Position
JoAnne Stephenson
Independent Non-Executive Director
Acting Chairman from 29 October 2020 to 15 September 2021
Chairman from 16 September 2021
John King
Chief Executive Officer and Managing Director
Jacquie Naylor
Independent Non-Executive Director
Dave Whittle
Ari Mervis
Independent Non-Executive Director
Independent Non-Executive Director
Date appointed
28 November 2016
4 June 2018
27 May 2019
30 November 2015
20 September 2021
Ari Mervis was appointed to the Board with effect from 20 September 2021. All other directors served as directors of the Company
for the whole financial period and until the date of this Directors’ Report. Details of the qualifications, experience, and special
responsibilities of each current director are set out below.
JoAnne Stephenson
Independent Non-Executive
Director
•
•
•
•
•
•
Member of the Board since 28
November 2016
Acting Chairman from 29
October 2020 to 15 September
2021
Chairman from 16 September
2021
Member – Audit, Finance and
Risk Committee
Chairman – Nomination
Committee
Member – Human Resources
and Remuneration Committee
John King
Chief Executive Officer &
Managing Director
•
Member of the Board since 4
June 2018
JoAnne has extensive experience spanning over 25 years across a range of
industries. JoAnne was previously a senior client partner in the Advisory division at
KPMG and has key strengths in finance, accounting, risk management and
governance. JoAnne holds a Bachelor of Commerce and Bachelor of Laws (Honours)
from The University of Queensland. She is also a member of both the Australian
Institute of Company Directors and Chartered Accountants in Australia and New
Zealand.
Other Current Directorships
JoAnne is an Independent Non-Executive Director of Challenger Limited and Qualitas
Limited. She is also Chair of the Victorian Major Transport Infrastructure Board.
JoAnne was previously a director of Asaleo Care Ltd and Japara Healthcare Limited.
John was appointed CEO & Managing Director on 4 June 2018. In this role, John has
overall accountability for Myer strategy and performance. John brings to the role
more than 30 years’ retail experience in merchandising and management roles
across a variety of retail sectors, including department stores, value retail and
wholesale apparel.
John started his career at Sainsbury’s and also worked for Marks & Spencer before
taking senior roles in the manufacturing and wholesale sector in the UK and the USA.
John successfully led Matalan from 2003 to 2006, an apparel and housewares
retailer based in the UK. In this role, John launched new brands, opened 20 new stores
and successfully sold the company back to the founder. More recently, John led the
successful turnaround of House of Fraser from 2006 to 2015. During his tenure he
improved the product differentiation, decreased debt, improved EBITDA and
repositioned the business as one of the leading premium department stores in the
UK.
1
Myer Annual Report 2022Directors’ Report
17
Jacquie was appointed as a Non-Executive Director on 27 May 2019. Jacquie brings
to the role a wealth of experience and knowledge of both women’s and men’s
apparel, homewares and outdoor brands. She has been an owner, director and
executive at some of the most iconic Australian retailers. Jacquie has held the
position of Non-Executive Director at The PAS Group and in addition, Jacquie was a
Non-Executive Director of one of the world’s most trusted outdoor brands, Macpac,
which is sold in more than thirty countries.
At the Just Jeans Group, Jacquie was a Group Executive Director and responsible for
driving the merchandise, marketing and brand strategies of five of their key brands
including Just Jeans, Jay Jays, Portmans, Jacqui E and Dotti.
Jacquie brings to the Myer Board considerable eCommerce experience from her
retail career and as a strategic adviser at Practicology, a digital marketing and
eCommerce agency.
Jacquie was a Non-Executive Director of the Virgin Australia Melbourne Fashion
Festival for more than 12 years and remains committed to showcasing the fashion
industry as well as new and emerging talent. Jacquie is also a member of the
Australian Institute of Company Directors and of the International Women’s Forum.
Other Current Directorships
Jacquie is a Non-Executive Director of Cambridge Clothing Ltd and Michael Hill
International Limited.
Dave has considerable brand, data, technology, omni-channel retail and digital
transformation experience. Over the last six years Dave has led Lexer, a global
software company helping brands and retailers genuinely understand and engage
their customers. Previously, Dave spent 10 years with global advertising group M&C
Saatchi in a number of local and international leadership roles, culminating in three
years as Managing Director in Australia. Prior to joining M&C Saatchi, Dave was the
first employee of a marketing services group that built four digital service and
software businesses. Dave has a Bachelor of Arts and a Bachelor of Commerce from
Deakin University.
DIRECTORS’ REPORT
Continued
Jacquie Naylor
Independent Non-Executive
Director
•
•
•
•
Member of the Board since 27
May 2019
Member – Audit, Finance and
Risk Committee
Member – Nomination
Committee
Chairman – Human Resources
and Remuneration Committee
Dave Whittle
Independent Non-Executive
Director
Member of the Board since 30
November 2015
Chairman – Audit, Finance and
Risk Committee
Member – Nomination
Committee
•
•
•
•
Member – Human Resources
and Remuneration Committee
Other Current Directorships
Dave is a director of Lexer Pty Ltd.
Ari Mervis
Independent Non-Executive
Director
•
•
•
Member of the Board since 20
September 2021
Member – Audit, Finance and
Risk Committee
Member – Nomination
Committee
Ari has broad global experience spanning a range of industries in branded goods,
consumer staples, agriculture, food and beverages. Ari’s career includes more than
25 years with global brewer SABMiller plc, including nearly 10 years as Managing
Director of the Asia Pacific region. In this role, Ari was Chairman of China Resources
Snow Breweries, a joint venture between China Resources Enterprises and SABMiller
for 8 years, and Chairman of SAB India and SAB Vietnam. He was also responsible for
the acquisition and integration of Carlton and United Breweries by SABMiller.
More recently, Ari was the Executive Chairman of Accolade Wines from 2018 to 2020,
and Managing Director and CEO of Murray Goulburn from 2017 to 2018.
Ari brings a wealth of experience in formulating and executing strategies that helps
drive top line growth in a sustainable and responsible manner. Ari has a Bachelor of
Commerce from the University of Witwatersrand.
Other Current Directorships
Ari is a Non-Executive Director and Chairman of McPherson’s Limited.
2
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
18
DIRECTORS’ REPORT
Continued
2. Directorships of Other Listed Companies
The following table shows, for each director, all directorships of companies that were listed on the ASX, other than the Company,
since 31 July 2019, and the period during which each directorship has been held.
Director
Listed entity
Period directorship held
JoAnne Stephenson
Challenger Limited
October 2012 – present
John King
Jacquie Naylor
Dave Whittle
Ari Mervis
Asaleo Care Limited
May 2014 – June 2021
Japara Healthcare Limited
September 2015 – November 2021
Qualitas Limited
November 2021 - present
-
-
Michael Hill International Limited
15 July 2020 – present
-
-
McPherson’s Limited
February 2021 – present
3. Meetings of Directors and Board Committees
The number of meetings of the Board and of each Board Committee held during the period ended 30 July 2022 are set out
below. All directors are invited to attend Board Committee meetings. Most Board Committee meetings are attended by all
directors; however, only attendance by directors who are members of the relevant Board Committee is shown in the table below.
Director
Directors
Risk Committee
Committee
Meetings of
Audit, Finance and
Human Resources
and Remuneration
Nomination
Committee
Meetings
Held*
Attended Meetings
Attended Meetings
Attended Meetings
Attended
Held*
Held*
Held*
JoAnne Stephenson
John King
Jacquie Naylor
Dave Whittle
Ari Mervis(1)
16
16
16
16
13
16
15
15
16
12
6
-
6
6
4
6
-
6
6
4
7
-
7
7
-
7
-
7
7
-
3
-
3
3
2
3
-
3
3
2
* Number of meetings held during the time the director held office or was a member of the Committee during the period.
(1)
Ari Mervis was appointed to the Board as an Independent Non-Executive Director, and as a member of the Audit Finance and Risk Committee and
Nomination Committee, with effect from 20 September 2021.
4. Directors’ Relevant Interests in Shares
The following table sets out the relevant interests that each director has in the Company’s ordinary shares or other securities as
at the date of this Directors’ Report. No director has a relevant interest in a related body corporate of the Company.
Director
Ordinary Shares
Deferred Rights
Rights
Options
Performance
Performance
JoAnne Stephenson
300,000
Nil
Nil
Nil
3,582,432
677,602
4,912,180
5,598,756
211,000
266,666
250,000
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
John King
Jacquie Naylor
Dave Whittle
Ari Mervis
3
Myer Annual Report 2022Directors’ Report
19
DIRECTORS’ REPORT
Continued
5. Company Secretary and Other Officers
Paul Morris is the General Counsel and Company Secretary of the Company. Prior to joining Myer, Paul was General Counsel and
Company Secretary of Spotless Group.
Nigel Chadwick is the Chief Financial Officer of the Company. Details of Nigel’s experience and background are set out in the
Executive Management Team section of Myer’s Investor Centre website.
6. Principal Activities
During the financial period, the principal activity of the Group was the operation of the Myer department store business.
7. Operating and Financial Review
The Directors’ Report includes references to Non-IFRS financial measures which represent the financial performance of the
Group excluding implementation costs and individually significant items. Refer to the Non-IFRS Financial Measures section
below.
Summary of Financial Results for 52 Weeks Ended 30 July 2022:
•
•
•
•
•
•
•
•
•
•
(1)
(2)
Total sales(1) up 12.5% to $2,989.8 million; up 15.0% on a comparable sales basis(2).
Group online sales(3) of $722.8 million, up 34.0%, representing 24.2% of total sales.
Operating Gross Profit (OGP) improved by 8.5% to $1,145.2 million, with OGP margin declining by 141 basis points to 38.3%.
Cost of Doing Business(4) as a percent to sales decreased by 12 basis points, and was $745.2 million, including rent waivers.
Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA)(4) of $400.0 million.
Net profit after tax(4) was $60.2 million, compared to net profit after tax(4) of $51.7 million in prior year.
Implementation costs and individually significant items of $11.2 million ($13.2 million pre-tax) included store closure and
space exit costs and asset impairments.
Statutory net profit after tax of $49.0 million, up 5.7% from prior year of $46.4 million.
Net cash position of $185.9 million, an improvement of $74.1 million compared to FY21, reflecting disciplined approach to the
balance sheet and cost control.
Final dividend of 2.5 cents per share, fully franked, to be paid on 7 November 2022 (Record Date is 29 September 2022).
Revenue from sale of goods excluding concession sales and sales revenue deferred under customer loyalty program was $2,340.6 million (FY21: $2,116.5
million)
In addition to the historical definition of comparable sales, stores closed during COVID-19 have been removed from both the current and previous year to
obtain comparable sales. Where a store was closed mid-week, the week in which the store closed has been removed. On reopening, the store has been
included from the first full week of trade. Also excluded is the 53rd week in 2021
(3) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads
(4)
Excluding implementation costs and individually significant items
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Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
20
DIRECTORS’ REPORT
Continued
Income Statement for the 52 Weeks to 30 July 2022
Total sales(1)
Operating gross profit
Cost of doing business(2)
EBITDA(2)
Depreciation(2)
EBIT(2)
Net finance costs
Tax(2)
Profit after tax(2)
Implementation costs and individually significant items (post-
tax)
2022
$m
2,989.8
1,145.2
(745.2)
400.0
(215.8)
184.2
(98.9)
(25.1)
60.2
(11.2)
2021
$m
2,658.3
1,055.7
(665.7)
390.0
(219.5)
170.5
(96.1)
(22.7)
51.7
(5.3)
Change
12.5%
8.5%
11.9%
2.6%
(1.7%)
8.0%
2.8%
10.7%
16.5%
111.2%
Statutory profit after tax
49.0
46.4
5.7%
(1)
(2)
Revenue from sale of goods excluding concession sales and sales revenue deferred under customer loyalty program was $2,340.6 million (FY21: $2,116.5
million)
Excluding implementation costs and individually significant items
Balance Sheet as at 30 July 2022
July 2022
$m
371.4
(429.3)
147.2
(96.7)
1,177.8
July 2021
$m
305.2
(353.3)
137.3
(85.6)
1,224.1
(1,699.2)
(1,735.5)
21.2
283.8
240.2
65.1
81.5
(58.0)
243.9
185.9
267.4
21.7
296.8
240.2
64.2
115.1
(66.8)
178.6
111.8
226.9
Inventory
Creditors
Other assets
Other liabilities
Right-of-use assets
Lease liabilities
Property
Fixed assets
Intangibles – Brands
Intangibles - Software
Total Funds Employed
Debt
Less Cash
Net Cash
Equity
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Myer Annual Report 2022Directors’ Report
21
DIRECTORS’ REPORT
Continued
Cash Flow for the 52 Weeks to 30 July 2022
EBITDA(1)
Less Implementation costs and individually significant items
Add Non-cash impairments
Working capital movement
Operating cash flow (before interest and tax)
Conversion
Tax (paid)/refunded
Net Interest paid
Interest – lease liabilities
Operating cash flow
Capex paid(2)
Free cash flow
Dividends paid
Principle portion of lease liabilities paid
Other
Net cash flow
Excluding implementation costs and individually significant items
(1)
(2) Net of landlord contributions
Shares and Dividends
Shares on issue
Basic earnings per share(1)
Basic earnings per share (pre implementation and individually significant
items)(2)
2022
$m
400.0
(13.2)
2.4
(2.3)
386.9
99.4%
(16.4)
(7.3)
(87.8)
275.4
(44.2)
231.2
(12.3)
(139.6)
(0.6)
78.7
2021
$m
390.0
(7.6)
1.8
(19.0)
365.2
95.1%
6.8
(7.5)
(87.2)
277.3
(31.9)
245.4
-
(140.3)
(0.4)
104.7
2022
2021
821.3 million
821.3 million
6.0 cents
7.3 cents
5.7 cents
6.3 cents
Dividend per share
4.0 cents
Nil
(1) Calculated on weighted average number of shares of 820.6 million (FY21: 818.9 million) and based on NPAT
(2) Calculated on weighted average number of shares of 820.6 million (FY21: 818.9 million) and based on NPAT pre implementation costs and individually
significant items
6
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
22
DIRECTORS’ REPORT
Continued
Non-IFRS Financial Measures
The Company’s results are reported under International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board. The Company discloses certain non-IFRS measures in this Directors’ Report, which can be
reconciled to the Financial Statements as follows:
Income Statement Reconciliation
$ millions
Statutory reported result
EBIT
Interest
Tax
NPAT
171.0
(98.9)
(23.1)
49.0
Add back: implementation costs and individually significant items
Space exit costs and other asset impairments
13.2
-
(2.0)
11.2
Results excluding implementation costs and individually significant items
184.2
(98.9)
(25.1)
60.2
FY22 Operations
In addition to the Company’s actions during the COVID-19 pandemic as noted below, the Company achieved the following
during FY22:
•
•
•
•
•
•
•
•
•
•
(1)
(2)
2H FY22 represented the best second half NPAT(1) since 2H FY13.
Comparable sales growth of 15%.(2)
Group online sales(3) of $722.8 million, representing 24.2% of total sales, driven by conversion improvements and a record
online Net Promoter Score.
Launched the popular Commbank pay with points partnership online, which was previously only available in-store.
Launched The Movement at Myer, an all-encompassing fitness and lifestyle destination.
Continued to improve the MYER one program resulting in an increase in tag rate to 71.3% (FY21: 69.7%).
Exited the Blacktown and Knox stores, and refurbished the Toowoomba and Albury stores.
Relocated the Store Support Office (SSO) to a new and smaller footprint.
Took possession of the National Distribution Centre (NDC) facility in Ravenhall, Victoria. Expect the state of the art facility to
be fully operational in 2H FY23.
Refinanced existing credit facilities with a four-year Asset Based Loan funding package.
Excluding implementation costs and Individually Significant Items
In addition to the historical definition of comparable sales, stores closed during COVID-19 have been removed from both the current and previous year to
obtain comparable sales. Where a store was closed mid-week, the week in which the store closed has been removed. On reopening, the store has been
included from the first full week of trade. Also excluded is the 53rd week in 2021
(3) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads
Further to these matters, Section 9 provides an outline of the Company’s future developments and strategy. These should be
read in conjunction with Section 10, which describes factors that could impact the Company’s results.
7
Myer Annual Report 2022Directors’ Report
23
DIRECTORS’ REPORT
Continued
Impact of COVID-19
The COVID-19 pandemic and associated Government actions had an ongoing impact on the Company during FY22. The
Company’s response has been managed by its Executive Management team, and Board, with the primary focus being on the
health and wellbeing of its customers, team members and the broader community in which it operates, and in supporting
government health measures.
As a result of COVID-19 outbreaks in the community and Government directions, the Company temporarily closed some stores
across its network in the first half of FY22. A breakdown of the temporary store closures is set out below.
State
Period of temporary closure
Days closed
Stores affected
Australian Capital
Territory
13 August 2021 – 21 October 2021
70 days
2 stores
New South Wales
1 August 2021 – 10 October 2021
6 August 2021 – 10 October 2021
12 August 2021 – 10 October 2021
15 August 2021 – 10 September 2021
17 September 2021 – 22 September 2021
Queensland
1 August 2021 – 8 August 2021
Tasmania
Victoria
9 August 2021 – 11 August 2021
16 October 2021 – 18 October 2021
6 August 2021 – 28 October 2021
6 August 2021 – 9 August 2021
22 August 2021 – 9 September 2021
16 September 2021 – 22 September 2021
20 September 2021 – 26 September 2021
71 days
66 days
60 days
27 days
6 days
8 days
3 days
3 days
84 days
4 days
19 days
7 days
7 days
16 stores
1 store
1 store
2 stores
1 store
9 stores
1 store
1 store
11 stores
3 stores
3 stores
1 store
1 store
The Company ceased to generate revenue or cash inflows from its physical stores during these temporary closures, other than
through click-and-collect services. When stores reopened in line with the easing of Government restrictions, various factors
continued to impact sales in physical stores including staffing challenges with significant numbers of team members absent as
a result of COVID-19 and isolation requirements, the ongoing uncertainty generated by Omicron, the lack of tourism, a large
proportion of workers still working remotely, and reduced foot traffic (primarily in CBD store locations). Global supply chain
disruptions associated with COVID-19 also resulted in increased supply chain costs, shipping delays and disruption to stock flow.
8. Significant Changes in the State of Affairs in FY22
In addition to the matters described in Section 7 above, the following significant changes occurred during FY22:
•
•
JoAnne Stephenson was appointed Chairman of the Company with effect from 16 September 2021.
Ari Mervis was appointed as an Independent Non-Executive Director of the Company, and as a member of the Audit
Finance and Risk Committee and Nomination Committee with effect from 20 September 2021.
There were no new Executive appointments during the period.
9. Business Strategies and Future Developments
The Board and the Executive Management Group continue to focus on delivery against the Customer First Plan. The FY22 results
reflect the improving momentum driven by the successful transformation of the business achieved under the Customer First
Plan – it is the right strategy for the Company. The Customer First Plan further evolved during COVID-19 and focuses on the
following areas:
Accelerate Online: focus on profitable online growth in terms of both overall scale and as a percentage of total company
sales. Investment in customer experience has led to significant improvements in conversion and customer Net Promoter
Scores.
•
8
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
24
DIRECTORS’ REPORT
Continued
•
•
•
•
•
•
Accelerate Factory to Customer (F2C) change: improvements to online fulfilment (3PL / multicarrier) arrangements
delivered cost and customer experience benefits, and the development of a National Distribution Centre (expected to be
fully operational in 2H FY23) will be transformational to Myer’s supply chain and customer experience.
Engage the Customer: drive engagement and new customer growth through our MYER one loyalty base by delivering
improved rewards, leverage of new and expanded partnerships and greater personalisation.
Adapting our in-store experience: our focus on delivering an uplifted in-store experience has contributed to significantly
higher levels of in-store customer satisfaction. Investments in store formats and the product offer, and the increasing use
of technology in store, such as M-metrics and the one device strategy, will continue to deliver a compelling experience for
our customers.
Refocus Merchandise: improving our range in key categories, with continuation of a more disciplined approach to
purchasing and inventory, focusing on core lines and supplier relationships, making the big brands bigger.
Rationalise Property: strategically review, optimise and reduce our overall store space with a view to driving greater
profitability. Our approach will seek the appropriate balance between physical stores and online capability to better serve
our customers.
Reduce Costs: proactively realign our cost base to manage profitability and increase flexibility as the change to our
markets and channels accelerates.
10. Key Risks and Uncertainties
The Group’s strategies take into account the expected operating and retail market conditions, together with general economic
conditions, which are inherently uncertain. The Group has a structured proactive risk management framework and internal
control systems in place to manage material risks. The key risks and uncertainties that may have an effect on the Group’s ability
to execute its business strategies, and the Group’s future growth prospects and how the Group manages these risks, are set out
below.
External Environment Risks
Unstable and deteriorating macro-economic factors such as the fluctuation of the Australian dollar and increasing interest
rates; heightened domestic and global inflation; poor consumer confidence; changes in government policies; external, natural
or unforeseen events, such as an act of terrorism, political instability, national strike or pandemic; transition to a lower carbon
economy; physical impacts of climate change and weakness in the global economy could adversely impact the Company’s
ability to achieve financial and trading objectives. Myer regularly analyses and monitors economic and other available data to
allow the Company to develop action plans to mitigate the future impact on sales, and has implemented conservative hedging,
capital management, and marketing and merchandise initiatives to address the cyclical nature of the business.
Supplier and Supply Chain Risks
Myer monitors its supplier relationships and quality standards via a range of means, including implementation of its quality
assurance, compliance policies and rigorous procurement and contracting processes. Our sourcing offices maintain regular
contact with our supplier base to ensure they adhere to our requirements and also assist in any challenges they may have. We
continue to review new sourcing opportunities to allow us greater flexibility and diversification across the portfolio. This assists
with minimising any risks, helps ensure competitiveness and gives us the ability to expand ranges and brands.
Disruption in the global shipping industry, though reduced, remains a risk. Lockdowns in other countries may impact speed to
market through congested ports, shipping delays and increased costs, and disruption of stock flow. Supply chain management
continues to work with suppliers and partners to ensure these challenges are carefully monitored and addressed.
Competitive Landscape Risks
The Australian retail industry in which Myer operates remains highly competitive. The Company’s competitive position may be
negatively impacted by new entrants to the market, existing competitors, changes to consumer demographics and increased
online competition, which could impact sales. To mitigate these risks, Myer continues to select optimal merchandise assortment
with the right categories and brands.
COVID-19
The impact of the COVID-19 pandemic or other wide spread pandemics on the Company’s operations (including any
requirement for further temporary store closures), domestic and global economic conditions, and consumer behaviour remains
uncertain, and may adversely affect the Company’s financial position and performance. The Executive Management Group
continue to monitor and assist the business to adapt to changes in ongoing risks and adhere to Government requirements and
9
Myer Annual Report 2022Directors’ Report 25
DIRECTORS’ REPORT
Continued
health measures. In addition, the Company continues to remain agile to adapt to changing market conditions (including
adjusting its strategic initiatives in response to the changing market context), whilst maintaining its focus on the disciplined
management of costs and preservation of cash to ensure it is well placed to deal with any future impacts.
Technology Risks, including Cyber Security
With Myer’s increasing reliance on technology in a rapidly changing digital environment, there is a risk that the malfunction of IT
systems, outdated IT infrastructure, inability to attract and retain qualified team members, cyber-security violation or data
breach of personal information could have a detrimental effect on Myer’s sales, business efficiencies, and brand reputation. To
offset these risks, Myer continues to invest and develop in-house technology capabilities and engage with reputable third-party
IT service providers to ensure that we have reliable IT systems and issue management processes in place.
Brand Reputation Risks
As one of the top 10 most trusted brands in Australia as reported in the Roy Morgan 2022 Risk Report, Myer’s strong brand
reputation is crucial for building positive relationships with customers, suppliers, and contractors which in turn generates sales
and goodwill towards the Company. A significant event or issue (including a failure to meet stakeholder and regulatory
expectations in regards to the area of sustainability) could attract strong criticism of the Myer brand, which could impact sales
or our share price. Myer has a range of policies and initiatives to mitigate brand risk, including an updated Code of Conduct, a
Whistleblower Policy, an Ethical Sourcing Policy, marketing campaigns, and ongoing environmental and sustainability initiatives.
Strategic and Business Plan Risks
A failure to deliver our strategic Customer First Plan could impact sales, profitability, share price, and our reputation. It includes
that all team members, brand partners and suppliers provide our customers with the service, brands and products they desire
and expect, both in store and online. The strategy has been overlaid and enhanced with additional details of initiatives and
mitigation plans in response to COVID-19 to ensure it remains “fit for purpose”. This includes changes to the economic
environment, customer behaviours, and to the retail landscape.
People Management Risks
With the impact of current labour shortages in the external market, Myer needs to attract and retain talented senior managers
to ensure that our leadership team has the right skills and experience to deliver our strategy, and store and online team
members to ensure sales growth. Failure to do so may adversely impact Myer’s ability to deliver on its strategic imperatives.
Training and development programs continue to be offered to further refine the skills of our team members and business
leaders.
The safety of our team members, customers, and suppliers is a high priority at Myer. Failure to manage health and safety risks
could have a negative effect on team member wellbeing, and Myer’s reputation and performance. We conduct regular detailed
risk assessments at each store, distribution centre, and at our support office, as well as provide regular education sessions.
Regulatory Risks
From time to time, Myer may be subject to regulatory investigations and disputes, including by the Australian Taxation Office
(ATO), Federal or State regulatory bodies including the Australian Competition and Consumer Commission (ACCC), the
Australian Securities and Investments Commission (ASIC), the Australian Securities Exchange (ASX) and Federal and State work,
health and safety authorities. The outcome of any such investigations or disputes may have a material adverse effect on Myer’s
operating and financial performance. Myer has an established governance framework to monitor, assess and report on such
occurrences to senior management when they arise.
Litigation
The Company is required to maintain compliance with applicable laws and regulations. Failure to comply could result in
enforcement action and claims, which may have a material adverse impact on the Company’s reputation, financial
performance and profitability. Legal proceedings and claims may also arise in the ordinary course of the Company’s business
and could result in high legal costs, adverse monetary judgements, reputational damage and other adverse consequences. The
Company has an established governance framework to monitor, assess and report to management on litigation risks when they
arise, and seeks to minimise risk through appropriate compliance training for team members and management.
10
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review 26
DIRECTORS’ REPORT
Continued
11. Matters Subsequent to the End of the Financial Year
Following the end of the financial year, the Company announced that it will exit its Frankston store in January 2023. No other
matter or circumstance has arisen since the end of the financial year which has not been dealt with in this Directors’ Report or
the Financial Report, and which has significantly affected, or may significantly affect:
•
•
•
the Group’s operations in future financial years;
the results of those operations in future financial years; or
the Group’s state of affairs in future financial years.
12. Dividends
Myer paid an interim dividend of AU$0.015 per share, fully franked, totalling $12.3 million on 12 May 2022.
The Board has determined a final dividend of AU$0.025 per share, fully franked, to be paid on 7 November 2022 (Record Date of
29 September 2022).
This takes the total FY22 dividend to 4.0 cents per share.
Further information regarding dividends is set out in the Financial Statements (at note F3).
13. Performance Rights and Options Granted Over Unissued Shares
The Myer Long Term Incentive (LTI) plan operates for selected senior executives and has been in operation since December
2006. Under the LTI plan, the Company has granted eligible executives:
(1)
(2)
(3)
in FY21 and FY22, performance rights over unissued ordinary shares of the Company;
in FY19 and FY20, performance options over unissued ordinary shares of the Company, and
in previous years, performance rights over unissued ordinary shares of the Company,
with all options and rights issued, subject to certain vesting conditions. Shares delivered to senior executives as a result of the
vesting of performance options and rights can be either issued as new shares or purchased on market.
Each performance right entitles the holder to acquire one ordinary fully paid share in the Company (subject to the adjustments
outlined below).
Performance options are exercised on a net settlement basis; the executive is allocated the total number of shares that would
have been allocated upon exercise, less the number of shares equal to the value of the aggregated exercise price payable (and
the exercise price is not required to be paid). The number of shares delivered by the Company represents the value above the
exercise price in accordance with the formula below:
(A - B) / C, where:
A = Aggregate value of vested performance options (based on the market value of a share)
B = Aggregate exercise price payable
C = Market value of share
The net settlement method ensures that executive reward is aligned to shareholder value creation by only rewarding executives
if there is a growth to share price and material reward can be earned only if there is a significant growth to share price.
During the financial period ended 30 July 2022, the Company granted a total of 6,514,842 performance rights under the LTI plan:
1,469,558 performance rights to the CEO and 5,045,284 performance rights to other selected senior executives.
The performance options and rights granted under each offer are subject to different performance conditions. No performance
options or rights have been granted since the end of the financial period ended 30 July 2022.
In September 2021, a total of 30,046,033 performance options granted under the LTI plan in FY19 lapsed following testing against
the performance criteria.
The table in Section 14 sets out the details of performance options and rights that have been granted under the LTI plan and the
alignment rights plan and which remain on issue as at the date of this Directors’ Report.
A holder of a performance option or right may only participate in new issues of securities of the Company if the performance
option or right has been exercised, participation is permitted by its terms, and the shares in respect of the performance options
or rights have been allocated and transferred to the performance option or right holder before the record date for determining
entitlements to the new issue.
During FY21, the Transformative Incentive (TI) plan was introduced to replace the normal Short Term Incentive (STI) plan for a
11
Myer Annual Report 2022Directors’ Report 27
DIRECTORS’ REPORT
Continued
period of 2 years. Under the TI plan, the Chief Executive Officer and nominated executives receive 50% of the annual TI achieved
in cash and 50% in the form of deferred rights to shares in the Company.
During the financial period ended 30 July 2022, the Company issued a total of 2,294,105 deferred rights under the FY21 TI plan,
comprising 677,602 deferred rights to the CEO and 1,616,503 deferred rights to other nominated senior executives.
The number of deferred shares to be issued under the FY22 TI plan will be determined by dividing the dollar value of the deferred
component of the TI plan award outcome by the volume weighted average price of the Company’s shares over the five trading
days immediately following the release to the market of the Company’s full year FY22 results.
Further information about performance options and rights issued under the LTI plan and TI plan (including the performance
conditions attached to the performance options and rights granted under the LTI plan and TI plan, and the performance options
and rights granted to the KMP of the Company) is included in the Remuneration Report.
14. Shares Issued on the Exercise of Performance Options and Performance Rights
From time to time, the Company issues fully paid ordinary shares in the Company to the Myer Equity Plans Trust (Trust) for the
purpose of meeting anticipated exercises of securities granted under the LTI plan and TI plan. To calculate the issue price of
shares issued to the Trust, the Company uses the five-day volume weighted average price of the Company’s shares as at the
close of trading on the date of issue.
During the financial period ended 30 July 2022, 1,147,053 fully paid ordinary shares were purchased on market by the Trust and
2,987,987 shares were transferred from the Trust for alignment rights issued to John King and Allan Winstanley in 2018 and that
fully vested in FY21. Since 30 July 2022, no shares have been issued to or otherwise acquired by the Trust, and no fully paid
ordinary shares of the Company held by the Trust were transferred to participants in the LTI plan or TI plan.
Date performance rights and options granted
Expiry date
Issue price
21 November 2019 (options grant to CEO under the FY20 LTI plan
offer)
21 November 2019 (options grant to senior executives under the
FY20 LTI plan offer)
21 Nov 2023
21 Nov 2023
Nil
Nil
Number of
performance rights
and options
remaining on
issue(1)
5,598,756
18,658,535
9 November 2020 (rights grant to CEO under the FY21 LTI plan
offer)
9 November 2020 (rights grant to senior executives under the
FY21 LTI plan offer)
8 October 2021 (deferred rights grant to CEO under the FY21 TI
plan)
8 October 2021 (deferred rights grant to senior executives under
the FY21 TI plan)
10 November 2021 (rights grant to CEO under the FY22 LTI plan
offer)
10 November 2021 (rights granted to senior executives under the
FY22 LTI plan offer)
Closing balance of performance rights and options
n/a
Nil
3,442,622
n/a
Nil
10,697,922
Nil
Nil
n/a
n/a
n/a
n/a
677,602
1,616,503
1,469,558
5,045,284
47,206,782
(1)
Each performance right entitles the holder to receive one fully paid ordinary share in the Company, subject to the satisfaction of the relevant performance
outcomes. Performance options vest and are automatically exercised on a net settlement basis. The executive is allocated the total number of shares that
would have been allocated upon exercise, less the number of shares equal to the value of the aggregated exercise price payable (and the exercise price is
not required to be paid). The number of shares delivered by the Company represents the value above the exercise price in accordance with the formula
below:
(A - B) / C, where:
A = Aggregate value of vested performance options (based on the market value of a share)
B = Aggregate exercise price payable
C = Market value of a share
The number of performance options or rights that a holder is entitled to receive on the exercise of a performance option or right may also be adjusted in a
manner consistent with the ASX Listing Rules if there is a pro-rata issue of shares or a reconstruction of the capital of the Company.
12
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
28
DIRECTORS’ REPORT
Continued
15. Remuneration Report
The Remuneration Report, which forms part of this Directors’ Report, is presented separately from page 30.
16.
Indemnification and Insurance of Directors and Officers
The Company’s Constitution requires the Company to indemnify current and former directors, alternate directors, executive
officers and officers of the Company on a full indemnity basis and to the full extent permitted by the law against all liabilities
incurred as an officer of the Group, except to the extent covered by insurance. Further, the Company’s Constitution permits the
Company to maintain and pay insurance premiums for director and officer liability insurance, to the extent permitted by law.
Consistent with (and in addition to) the provisions in the Company’s Constitution outlined above, the Company has also entered
into deeds of access, indemnity and insurance with all directors of the Company which provide indemnities against losses
incurred in their role as directors, subject to certain exclusions, including to the extent that such indemnity is prohibited by the
Corporations Act 2001 (Cth) or any other applicable law. The deeds stipulate that the Company will meet the full amount of any
such liabilities, costs and expenses (including legal fees).
During the financial period, the Company paid insurance premiums for a directors’ and officers’ liability insurance contract that
provides cover for the current and former directors, alternate directors, secretaries, executive officers and officers of the
Company and its subsidiaries. The directors have not included details of the nature of the liabilities covered in this contract or
the amount of the premium paid, as disclosure is prohibited under the terms of the contract.
The Group’s auditor is PricewaterhouseCoopers (PwC). No payment has been made to indemnify PwC during or since the
financial period end. No premium has been paid by the Group in respect of any insurance for PwC. No officers of the Group were
partners or directors of PwC whilst PwC conducted audits of the Group.
17. Proceedings on Behalf of the Company
No person has applied to the court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the
Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking responsibility on behalf
of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with the leave of the court under section 237 of
the Corporations Act 2001.
18. Environmental Regulation
The Group is subject to and has complied with the reporting and compliance requirements of the National Greenhouse and
Energy Reporting Act 2007 (Cth) (NGER Act). The NGER Act requires the Group to report its annual greenhouse gas emissions
and energy use. The Group has implemented systems and processes for the collection and calculation of the data required. In
compliance with the NGER Act, the Group is due to submit its report by 31 October 2022. No significant environmental incidents
have been reported internally, and no breaches have been notified to the Group by any government agency.
The Group is a signatory to the Australian Packaging Covenant, which is a national co-regulatory initiative in place of state-
based regulatory arrangements for sustainable packaging management. Members are required to adhere to the covenant
commitments, which include development and implementation of an action plan and report annually on progress. The Group
submitted its report on 31 March 2022.
19. Non-Audit Services
The Company may decide to employ its external auditor on assignments additional to its statutory audit duties where the
auditor’s expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditor (PwC) for audit and non-audit services provided during the financial
period are set out in the Financial Statements (at note H5).
The Board has considered the position and, in accordance with advice received from the Audit, Finance and Risk Committee, is
satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors
imposed by the Corporations Act 2001. The directors are satisfied that the provision of the non-audit services by the auditor did
not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
all non-audit services have been reviewed by the Audit, Finance and Risk Committee to ensure that they do not impact on
the impartiality and objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics
for Professional Accountants.
•
•
13
Myer Annual Report 2022Directors’ Report 29
DIRECTORS’ REPORT
Continued
20. Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is attached to this
Directors’ Report.
21. Rounding of Amounts
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and,
except where otherwise stated, amounts in the Directors’ Report have been rounded off to the nearest hundred thousand dollars.
22. Annual General Meeting
The Annual General Meeting of the Company will be held on Thursday 10 November 2022.
The Directors’ Report is made in accordance with a resolution of directors.
JoAnne Stephenson
Chairman
Melbourne, 15 September 2022
14
Myer Annual Report 2022Directors’ ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
30
Remuneration
Report
REMUNERATION REPORT
Dear Shareholder,
On behalf of the Board, I present to you Myer Holdings Limited’s (Myer or the Company) Remuneration Report for FY22. This
report sets out the remuneration information for the Non-Executive Directors and Executive Key Management Personnel
(Executive KMP). It describes our executive remuneration framework and pay outcomes for FY22 in a simple and transparent
way.
The remuneration outcomes set out in this Report were carefully considered by the Board, taking into account all relevant
factors, including the Management team’s performance in delivering the FY22 results, and ensuring the best interest of our
shareholders and other stakeholders.
In determining the remuneration framework and assessing remuneration outcomes, Myer’s Remuneration objective is to support
Management to deliver a business strategy that puts our customers first and ultimately delivers value to our shareholders.
There are five key principles associated with the Remuneration objective:
(1) Reward outcomes that reinforce our Customer First Plan
(2) Build our capability by attracting and retaining high calibre talent
(3) Align the interests of our executives to those of our shareholders – think like owners
(4) Drive sustainable long-term performance of the business
(5) Be simple and transparent
Company Performance in FY22
The FY22 results showed the strength of Myer’s omni channel offering in driving sales and earnings momentum. The business
showed strong improvement in sales, profitability, cash generation and other key measures. Progress in our Customer First Plan
means Myer is well placed to drive value creation for all shareholders, and Myer recommenced dividend distributions during
FY22.
These results were achieved despite the impacts of the COVID-19 pandemic, particularly in 1H22 which saw Government
mandated lockdowns across the first quarter and then footfall during the Christmas and January sales periods impacted by the
Omicron variant. In 2H22, which was not impacted by lockdowns, Myer recorded its highest net profit after tax since 2H13(4)
demonstrating the strong momentum in the business.
FY22 results and highlights include:
•
Total sales(1) up 12.5% to $2,989.8 million; up 15.0% on a comparable sales basis(2).
• Group online sales(3) of $722.8 million, up 34.0%, representing 24.2% of total sales.
•
•
•
•
•
Net profit after tax(4) was $60.2 million, compared to net profit after tax(4) of $51.7 million in prior year.
Statutory net profit after tax of $49.0 million, up 5.7% from prior year of $46.4 million.
Net cash position of $185.9 million, an improvement of $74.1 million compared to FY21.
Launched the popular Commbank pay with points partnership online, which was previously only available in-store.
Launched The Movement at Myer, an all-encompassing fitness and lifestyle destination.
• Continued to improve the MYER one program resulting in an increase in tag rate to 71.3% (FY21: 69.7%), its highest since
public listing in 2009.
•
•
•
•
(1)
(2)
Exited the Blacktown and Knox stores, and refurbished the Toowoomba and Albury stores.
Relocated the Store Support Office (SSO) to a new and smaller footprint.
Took possession of the National Distribution Centre (NDC) facility in Ravenhall, Victoria, with the state of the art facility
expected to be fully operational in 2H23.
Refinanced existing credit facilities with a four-year Asset Based Loan.
Revenue from sale of goods excluding concession sales and sales revenue deferred under customer loyalty program was $2,340.6 million (FY21: $2,116.5
million)
In addition to the historical definition of comparable sales, stores closed during COVID-19 have been removed from both the current and previous year to
obtain comparable sales. Where a store was closed mid-week, the week in which the store closed has been removed. On reopening, the store has been
included from the first full week of trade. Also excluded is the 53rd week of 2021
(3) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads
(4)
Excluding implementation costs and individually significant items
1
Myer Annual Report 2022Remuneration Report
31
REMUNERATION REPORT
Continued
Changes to the Executive Remuneration Framework for FY21 and FY22
As outlined in both the FY20 and FY21 Remuneration Reports, in FY21 we made a number of changes to our remuneration
framework to further align the remuneration of our executives with the interests of our shareholders.
These changes included the introduction of the Transformation Incentive (TI) plan to replace the normal Short Term Incentive
(STI) plan for both FY21 and FY22.
The objective of the TI plan was to promote longer-term shareholder interests during a crucial period for the Company, by
placing significant importance on transforming the business and ensuring an optimal response to the challenges presented by
the COVID-19 pandemic. In line with this, financial performance was measured against net profit after tax, the strongest
indicator of Myer’s profitability, but performance was also assessed against key measures critical to the transformation of Myer,
such as online profitability, physical stores earnings per square metre, management of stock and the MYER one tag rate.
For the period of the TI plan, a greater portion of Executive KMP’s remuneration was also weighted towards the TI plan, relative to
the Long Term Incentive (LTI) plan, and a higher percentage of awards were granted in equity as opposed to cash. The Board is
pleased with the outcomes of the TI plan over the last two years, as well as the positive shareholder response.
As previously disclosed, from FY23 we will revert to a more traditional STI structure and remuneration mix. The Board has decided
to retain key elements of the TI plan, including in particular transformative performance measures that remain strongly aligned
to our Customer First Plan.
The LTI plan introduced for FY21 has been retained, with the delivery of the plan by way of performance rights as opposed to
performance options; and the inclusion of a positive absolute Total Shareholder Return (TSR) gateway measure, which prevents
reward outcomes where there have been declines in shareholder return over the performance period.
The changes made to the executive remuneration framework over the past two years support the Company’s transformation
agenda and the challenging macro environment. As always, the Board is focussed on maintaining a strong link between
transforming our business performance and executive remuneration outcomes, as well as ensuring our approach to executive
remuneration supports the delivery of our Customer First Plan, for the benefit of our customers and our shareholders.
Executive Remuneration Outcomes in FY22
The Board believes the remuneration outcomes detailed below reflect the performance of our Executive KMP during FY22,
including in particular the Executive Management’s Team efforts in continuing to lead the transformation of the business in
alignment with our Customer First Plan.
•
The freeze on the CEO and Managing Director’s total fixed compensation (TFC) continued in FY22.
• Other Executive KMP received a 5% TFC increase effective 1 April 2022, which was their first increase to TFC since 2015
(apart from an increase made to the CFO’s TFC in 2018 to reflect a change to his role). The Board considered this to be an
appropriate decision given the continuing priority to retain our high calibre senior personnel who are critical in the delivery
of our Customer First Plan and market conditions. This increase was effected as part of the annual remuneration review
process conducted at this time for salaried team members.
• When assessing performance and associated remuneration outcomes for the FY22 TI plan, the Board made the
decision to take account of material matters beyond the control of the executive team, including in particular extensive
store closures in the first half of FY22 as well as the impact of the Omicron wave.
•
•
(1)
Executive KMP and the broader Management team will receive a TI award equal to 47.3% of their maximum entitlement.
The TI award outcome reflected strong performance against the key financial metric of net profit after tax, with the
Company’s growth in profitability driven by the Management team’s efforts in continuing to lead the transformation of the
business in alignment with our Customer First Plan. Despite strong progress in relation to other key transformational
measures, the challenging targets set by the Board for these measures were not met and there was no vesting in relation to
these measures.
In relation to performance options issued under the FY20 LTI plan for Executive KMP, the Relative TSR component did not vest,
but maximum performance under the EPS condition was met with a compound annual growth rate of 22.4%(1).
EPS compound annual growth rate is calculated using net profit after tax excluding implementation costs and individually significant items
Non-Executive Director Remuneration
Following the reductions in Board fees disclosed in the FY21 Remuneration Report after taking account of shareholder feedback,
there have been no further changes to the Chairman’s and Non-Executive Directors’ base annual fees and these reduced fees
will continue to apply for the duration of FY23.
2
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
32
REMUNERATION REPORT
Continued
FY23 Remuneration Framework
At our 2021 Annual General Meeting (AGM), the majority of eligible shareholder votes cast (63.18 percent) were in favour of
adopting the FY21 Remuneration Report and 36.82 percent of the votes cast were against the adoption of the Report.
The Board has determined to revert back to a more traditional STI and LTI framework for FY23.
While the total variable remuneration opportunity will not change for FY23, the overall remuneration mix will shift with the STI
opportunity decreasing from 100% to 90% for the CEO and Managing Director and 75% to 65% for other Executive KMP and the LTI
opportunity increasing from 70% to 80% for the CEO and Managing Director and 45% to 55% for other Executive KMP, promoting
long-term shareholder alignment.
Further details regarding the FY23 remuneration framework will be provided in the Notice of Meeting and next year’s
Remuneration Report.
We thank the many stakeholders who have shared their feedback with us over the past year. The Board will continue to take
account of the views of our shareholders in reviewing and setting the remuneration framework.
Yours faithfully,
Jacquie Naylor
Chairman – Human Resources and Remuneration Committee
3
Myer Annual Report 2022Remuneration Report
REMUNERATION REPORT
Continued
Contents
(1)
Introduction
(2) Snapshot of Remuneration Framework
(3) Executive KMP Remuneration
(4) Executive KMP Service Agreements
(5) Non-Executive Director Remuneration
(6) Remuneration Governance
(7) Executive KMP Statutory Disclosures
(8) Equity
(9) Loans
(10) Dealing in Securities
1.
Introduction
33
33
34
39
46
46
49
50
55
56
56
The Directors of the Company present the Remuneration Report for the financial period ended 30 July 2022 prepared in
accordance with the requirements of the Corporations Act 2001 (Cth) and its regulations.
This report outlines the remuneration strategy, framework and other conditions of employment for Executive KMP and Non-
Executive Directors, and details the role and accountabilities of the Board and relevant Committees that support the Board on
these matters.
The information provided within this report has been audited as required by section 308(3C) of the Corporations Act 2001 and
forms part of the Directors’ Report. The table below details the Company’s Executive KMP and Non-Executive Directors during
FY22.
All KMP were in their roles for the full year, unless otherwise stated.
Name
Role
Non-Executive Directors
J Stephenson(1)
Chairman, Independent Non-Executive Director
D Whittle
J Naylor
A Mervis(2)
Executive Directors
Independent Non-Executive Director
Independent Non-Executive Director
Independent Non-Executive Director
J King
Chief Executive Officer and Managing Director
Other Executive KMP
N Chadwick
A Sutton
A Winstanley
Chief Financial Officer
Executive General Manager Stores
Chief Merchandise Officer
Ms Stephenson was Acting Chairman from 29 October 2020 to 15 September 2021, and was appointed Chairman with effect from 16 September 2021.
(1)
(2) Mr Mervis was appointed as a Non-Executive Director with effect from 20 September 2021.
4
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review 34
REMUNERATION REPORT
Continued
2. Snapshot of Remuneration Framework
2.1 Objective and Guiding Principles
Our remuneration objective is to support Executive KMP in delivering a business strategy that will put our customers first and
ultimately deliver value to our shareholders.
2.2 Remuneration Structure for FY22
Strategic objectives and performance link
Performance measures
What has changed for FY22?
Total Fixed Compensation (TFC)
•
•
•
To attract and retain high calibre talent.
•
Provides “predictable” base level of
reward.
Set with reference to the market using
external benchmark data.
Varies based on employee’s
experience, skills, and
•
No changes to the CEO and
Managing Director’s TFC during
performance.
FY22.
• Consideration is given to both
•
The other Executive KMP
internal and external
relativities across retail and
other relevant sectors.
received a TFC increase of 5%,
effective 1 April 2022 which
represents the first TFC increase
for the Executive KMP since
2015(1).
Transformation Incentive (TI) plan
For Executive KMP, 50 percent of the
award is delivered in cash, and 50
percent is delivered in deferred shares
subject to a disposal restriction for 12
months (as to 25 percent) and 24
months (as to the other 25 percent)
following performance testing. Under the
TI plan, a greater portion of the award is
delivered in equity and there is a longer
deferral period than the previous STI plan
(FY20).
Designed to drive the short-term
financial and strategic objectives of the
Company, aligned to the accelerated
Customer First Plan and Myer’s
turnaround strategy.
Encourages focus on long-term value in
addition to annual results, through the
equity component.
•
•
TI awards for all participants
at Myer are assessed against
a set of balanced scorecard
measures outlined below:
•
•
Net profit after tax
accounts for 50 percent
of the maximum TI.
Transformation
progress against the
accelerated Customer
First Plan accounts for
50 percent of the
maximum TI.
Transformation measures
include online EBIT, Bricks &
mortar EBITDA per square
metre, cost per customer
order, Stock turn performance
and MYER one tag rate(2).
•
•
•
This is the second and final year
of the TI plan. The FY22 TI plan
remains largely unchanged from
the FY21 TI plan.
Performance measures remain
focused on our Customer First
Plan and Myer’s turnaround
strategy with net profit after tax
the key financial measure of
performance under the TI plan.
The equity component will be
delivered in deferred shares
subject to a disposal restriction
only, over a period of 12 and 24
months.
•
•
•
5
Myer Annual Report 2022Remuneration Report
35
•
•
Performance rights have been
maintained for the FY22 LTI plan.
The absolute TSR gateway which
was introduced last year has
also been maintained.
REMUNERATION REPORT
Continued
Long Term Incentive (LTI)
•
•
Delivered in equity, in the form of
performance rights, which most
appropriately aligns Executive KMP with
shareholder interests and avoids the
dilutive impact of performance options.
Focused on delivery of Myer’s long-term
business strategy and shareholder value
creation.
• Measures complement those in the TI
plan to provide a holistic and aligned
reward offer.
•
Supports ongoing, sustainable
performance and the retention of key
executive talent.
•
All Performance Rights
granted under each LTI award
will be tested against a
positive absolute Total
Shareholder Return (TSR)
gateway measure.
• Where positive TSR is
achieved over the 3-year
performance period (FY22-
FY24), the award will be
assessed against:
•
•
Relative TSR (50 percent
of award) against a
retail and consumer
services peer group;
and
Underlying Earnings Per
Share (EPS) compound
annual growth (50
percent of award).
•
Performance is measured
over 3 years and shares are
provided on vesting following
performance testing, which
are restricted for 12 months.
For the CEO and Managing
Director, performance is
measured over 3 years, but
the vesting period is 4 years
and no further restriction
period applies.
(1)
(2)
Apart from an increase made to the CFO’s TFC in 2018 to reflect an increase in the scope of his role.
For more details on performance measures, refer to Section 3.2.
The following diagram shows how our remuneration framework is delivered to Executive KMP (dates provided are not intended
to be exhaustive). The CEO and Managing Director has a vesting period of 4 years for the LTI, with no restriction period which has
not been illustrated in the below diagram.
6
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
36
REMUNERATION REPORT
Continued
2.3
Company Performance for FY22
The Company’s remuneration structure aligns Executive KMP remuneration with shareholder interests over the short and long
term and provides an appropriate reward on delivering our strategy.
The table below presents the Company’s annual performance against key financial metrics since 2018.
Basic EPS (cents)
Basic EPS (cents) – adjusted(1)
Net profit after tax (NPAT) (pre implementation costs and individually
significant items) ($m)
FY18
FY19
FY20
FY21
FY22
(59.2)
3.0
(21.0)
4.0
4.0
(1.6)
5.7
6.3
6.0
7.3
32.5
33.2
(13.4)
51.7
60.2
NPAT (post implementation costs and individually significant items)
($m)
(486.0)
24.5
(172.4)
46.4
49.0
Dividends (cents per share)
-
-
-
-
4.0
Share price at beginning of year ($)
0.77
0.46
0.53
0.21
0.49
Share price at end of year ($)
Market capitalisation ($m)
0.46
0.53
0.21
0.49
0.47
377.8
435.3
172.5
402.4
386.0
(1)
Basic EPS is adjusted to exclude implementation costs and individually significant items. Refer to Section 7 of the Directors’ Report for further details. The
Directors believe this metric is more relevant as it excludes individually significant items that may not recur and may not be predictive of future
performance.
2.4 Remuneration Outcomes for FY22
FY22 TFC
No increase was made to the CEO and Managing Director’s TFC in FY22. Mr King’s fixed TFC has not increased since his
appointment in June 2018.
The other Executive KMP received a TFC increase of 5%, effective 1 April 2022 in response to labour market pressures and to
ensure we retain our critical executive talent through our transformation period. This increase was effected as part of the annual
remuneration review process conducted at this time for salaried team members. This represents the first TFC increase for
Executive KMP since 2015, apart from an increase made to the CFO’s TFC in 2018 to reflect an increase in the scope of his role.
TFC consists of base salary plus statutory superannuation contributions. Executive KMP receive a TFC package which is reviewed
annually by the Human Resources and Remuneration Committee with reference to Company and individual performance, size
and complexity of the role and benchmark market data.
FY22 TI Plan Outcome
The Board set challenging performance targets for the FY22 TI following a robust target setting process that took into account
many factors, including FY21 performance, market conditions such as disruptions to the supply chain and the continuing
challenges presented by COVID-19.
Following a year in which significant progress was made by our people in delivering the Customer First Plan, TI outcomes for FY22
reflect the strong growth that was again achieved against the key financial metric of net profit after tax.
The remaining TI metrics were transformational objectives, aligned with key priorities of the Customer First Plan. These measures
comprised online EBIT, Bricks & mortar EBITDA per square metre, cost per customer order, Stock turn performance and MYER one
tag rate. Whilst FY22 saw further strong progress in relation to these measures, the challenging threshold targets set by the
Board were not achieved.
Actual TI payments to each Executive KMP are detailed in the table at Section 7. The payment of a TI award for FY22 represents
the second time that the Company has paid either a TI or STI award to Executive KMP since the STI award relating to FY16.
7
Myer Annual Report 2022Remuneration Report
REMUNERATION REPORT
Continued
The following table details FY22 TI scorecard measures and assessment applied to Executive KMP.
Objectives
2022 Performance Assessment
Commentary
Financial Objectives (50% weighting)
NPAT
Threshold hurdle exceeded
•
NPAT threshold target achieved despite
37
Transformation Objectives (50% weighting, 10% for each measure)
Online Earnings Before
Interest and Taxes
Threshold hurdle not met
Cost per Customer Order
Threshold hurdle not met
Department Store, Bricks and Mortar
EBITDA per square metre
Threshold hurdle not met
Stock turn
Threshold hurdle not met
MYER one tag rate
(in-store and online) %
Threshold hurdle not met
lockdowns in FY22.
• Company achieved highest 2H NPAT(1)
since 2H13.
•
•
•
•
Achieved strong growth from sales
increase and significant market share
gains but below stretch transformation
objective.
Did not achieve targeted improvement
Year on Year (YoY).
Despite a 15% YoY increase in this metric,
did not meet the stretch transformation
objective due to 1H22 lockdowns and
COVID-19 impacts.
Despite the improvements to inventory
health, stock-turn did not meet threshold
hurdle as more inventory on average was
held due to 1H22 COVID-19 impacts and
to mitigate supply chain disruptions.
• Grew tag rate significantly YoY to 71.3%, a
record result since public listing in 2009,
but not above threshold hurdle, largely
due to Omicron impacts.
% of Maximum Achieved: 47.3%
(1)
Excluding implementation costs and individually significant items
FY20 LTI Plan Outcome
The FY20 LTI was tested equally against both performance conditions over the three-year performance period between 28 July
2019 and 30 July 2022. Maximum performance under the EPS condition (accounting for 50% of the performance options) was
met with a compound annual growth rate of 22.4%(1). The relative TSR component did not vest.
The performance options have an exercise price of $0.55 and will expire on 23 November 2023, four years after the grant date.
(1)
EPS compound annual growth rate is calculated using net profit after tax excluding implementation costs and individually significant items
8
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38
REMUNERATION REPORT
Continued
2.5 Payments to Executive KMP in FY22
The table below sets out the actual remuneration received by Executive KMP in FY22. The table has not been prepared in
accordance with accounting standards but has been provided to outline clearly the remuneration outcomes for Executive KMP.
Remuneration outcomes prepared in accordance with the accounting standards are provided in Section 7.
Short Term
Incentive
Long Term
Incentive
STI deferred
Vested &
Termination
Actual FY22
Name
Cash
salary(1)
$
Super-
annuation(2)
$
FY21 TIP(3)
$
from prior
year(4)
$
exercised
LTIP(5)
$
Executive Directors
J King(6)
1,200,000
-
387,318
-
1,386,486
Other Executive KMP
N Chadwick
784,538
23,712
192,449
A Sutton
647,288
23,712
159,769
A Winstanley(7)
808,250
-
192,449
-
-
-
-
-
316,666
and other
payments
Remuneration
$
$
-
-
-
-
2,973,804
1,000,699
830,769
1,317,365
(1) Cash salary includes short-term compensated absences, any salary sacrifice arrangement implemented by the Executive KMP, including additional
superannuation contributions.
(2)
Executive KMP receive a statutory superannuation contribution up to a threshold limit in line with the ATO published maximum superannuation contribution
base.
TIP payments relating to FY21 performance and conditions, but paid during FY22. Includes only the non-deferred component.
(3)
(4) Deferred STI relating to FY20 performance and conditions, paid during FY22.
(5) Mr King and Mr Winstanley exercised rights vested under their equity alignment plans following the opening of the trading window after the release of the
FY21 Results. The Myer share price at exercise was $0.57.
(6) Mr King does not receive superannuation contributions due to his tax status. As per the terms of his employment contract, Mr King is entitled to other
support, including a health insurance allowance, relocation expenses for spouse, and return flights home. This support has not been included in this table.
More details can be found in Section 7.
(7) Mr Winstanley does not receive superannuation contributions due to his tax status. As per the terms of his employment contract, Mr Winstanley is entitled
to other support, including a health insurance allowance and return flights home. More details can be found in Section 7.
9
Myer Annual Report 2022Remuneration Report
39
REMUNERATION REPORT
Continued
3. Executive KMP Remuneration
Executive KMP remuneration is delivered through a mix of fixed and variable (or “at risk”) pay, and a blend of short and longer-
term incentives. As outlined in the Remuneration Structure in Section 2.2, Executive KMP remuneration is made up of three
components:
•
•
•
Total Fixed Compensation;
Transformation Incentive Plan; and
Long Term Incentives.
The combination of these components comprises an Executive KMP’s total remuneration.
3.1 Total Fixed Compensation
TFC provides the base level of reward and is set at a level to attract and retain high calibre executives.
Features of Total Fixed Compensation
What is
included in
TFC?
TFC is structured as a total fixed remuneration package, made up of base salary, superannuation, other
benefits and Fringe Benefits Tax, where applicable. Some of the benefits include the opportunity to receive
a portion of fixed remuneration in a variety of forms, including fringe benefits such as motor vehicles, or to
make additional contributions to superannuation or retirement plans (as permitted by relevant
legislation).
How is TFC
reviewed?
TFC levels for each Executive KMP are set with reference to the market, the scope and nature of each role,
the incumbent’s experience and individual performance.
The Human Resources and Remuneration Committee (Committee) typically reviews and makes
recommendations to the Board regarding TFC for Executive KMP annually, having regard to Company and
individual performance and relevant comparative remuneration in the market.
The Board may also consider adjustments to Executive KMP remuneration outside the annual
remuneration review process as recommended by the CEO and Managing Director, such as on promotion
or as a result of additional duties performed by the Executive KMP. Where new Executive KMP join the
Company or existing Executive KMP are appointed to new roles, a review and benchmarking of fixed and
total remuneration is conducted prior to the offer and execution of a new employment contract.
Which
benchmarks
are used?
Remuneration for Executive KMP is considered in the context of the skills and experience being sought and
the global retail Senior Management market, as well as in relation to the other industries where we are
increasingly seeking talent. Benchmarking is also undertaken against local industry peer groups and
companies with a similar market capitalisation to Myer where relevant for the roles under review.
Mr King’s package was set with reference to the skills and experience required to turn around the
Company’s performance in what is a very challenging time in the retail industry. It must also be noted
that Myer is competing for talent in a very small pool of international candidates and the current package
was necessary to attract and retain a high quality, experienced CEO of Mr King’s calibre. Mr King’s fixed
remuneration was set at the same level as the previous CEO, and has not been adjusted since 2015.
Some of Mr King’s significant achievements have included:
•
•
Leading the ongoing business transformation under the Customer First Plan which was launched in
September 2018.
Delivering improved FY22 results, despite ongoing COVID-19 impacts, with the Company recording its
highest second half net profit after tax since 2H13(1), demonstrating the continuing strong momentum
in the business.
• Continued strong growth in the online business, now one of Australia’s largest online businesses,
demonstrating the strength of Myer’s omni channel offer (annual Group online sales(2) up to $722.8
million or 24% of total sales).
•
•
Further progress on space optimisation (exited Blacktown store and refurbished the Toowoomba
store).
Significantly improved net cash position of $185.9 million (up $74.1 million compared to FY21),
reflecting a disciplined approach to balance sheet and cost control.
10
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REMUNERATION REPORT
Continued
•
•
•
Relocated the Store Support Office (SSO) to a new and smaller footprint and took possession of the
NDC facility in Ravenhall, Victoria.
Refinanced existing credit facilities with a four-year Asset Based Loan.
Launched the Commbank pay with points partnership online (previously only available in- store).
• Continued to improve the MYER one program resulting in an increase in tag rate to 71.3% (highest
level since public listing in 2009), from 69.7% in previous year.
As in FY21, Mr King did not receive an increase to his TFC in FY22.
Excluding implementation costs and individually significant items
(1)
(2) Group online sales includes sass & bide and Marcs and David Lawrence. Excludes sales via in-store iPads.
3.2 Transformation Incentive Plan
As part of the executive reward review undertaken during FY20, the Transformative Incentive (TI) plan was introduced to replace
the normal STI plan for a period of 2 years, starting in FY21. The FY22 TI plan applied to all eligible executives, including Executive
KMP, senior managers, and other select participants, subject to certain conditions and performance criteria being met which are
reviewed and approved annually by the Board.
Form and purpose of the plan
What is the TI
The TI plan replaces the annual STI plan for a period of two years after which the Company intends to
plan?
return to a STI plan. The TI plan is an at risk component of an Executive KMP’s reward opportunity, with
longer deferral periods and greater deferral into equity than the previous STI plan, which is designed to
put a meaningful part of the Executive KMP’s remuneration at risk. Payment under the TI plan has been
designed to link a portion of remuneration to the transformation of Myer, aligned with delivery of the
Customer First Plan and to address the new challenges presented by COVID-19.
What is the
value of the TI
opportunity?
TI targets are set as a percentage of the Executive KMP’s TFC. The maximum levels for Executive KMP are
set out below.
• CEO and Managing Director – 100 percent of TFC.
• Other Executive KMP – 75 percent of TFC.
Does the TI
include a
deferred
50 percent of the FY22 TI award will be delivered in deferred shares subject to a disposal restriction
meaning that the shares are unable to be disposed during the restriction period. The TI plan also allocates
a greater portion of the TI award into equity than the previous STI plan which ensures further shareholder
component?
alignment.
The equity component to be granted under the FY22 TI plan will be issued in two tranches:
•
•
Tranche 1: 50% of the deferred shares will be subject to a one-year disposal restriction, which will not
be released until the first day after the first anniversary of the date on which the deferred shares are
granted which occurs during a trading window under the Company’s Security Dealing Policy; and
Tranche 2: the remaining 50% of deferred shares will be subject to a two-year disposal restriction,
which will not be released until the first day after the second anniversary of the date on which the
deferred shares are granted which occurs during a trading window under the Company’s Security
Dealing Policy.
Performance measures
What were the
The performance measures and their relative weightings applicable to the FY22 TI plan are:
FY22
performance
measures?
•
•
NPAT accounts for 50 percent of the TI scorecard.
Transformation measures (Online EBIT, cost per customer order, Bricks & mortar EBITDA per square
metre, stock turn performance, and MYER one tag rate) account for 50 percent of the TI scorecard,
with each measure counting towards 10 percent of the TI scorecard.
Why were the
performance
Performance measures under the TI plan are transformational in nature, in line with the accelerated
Customer First Plan. These measures immediately align Executive KMP effort with the turnaround strategy
measures
selected?
of the Company. The performance measures are quantifiable and heavily focused on financial
performance. The Board believes that a large component of an Executive KMP’s TI award should be driven
by the financial performance of the Company, and accordingly 50 percent of the TI is dependent on
Company NPAT, providing close alignment with shareholder outcomes.
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The Transformation measure reflects the significant importance of transforming the business and focus
on our Customer First Plan and turnaround strategy, including key focus areas of online profitability,
physical stores earnings per square metre, management of stock and M one tag rate. Targets are set at
stretching levels to align with the objectives set under the Customer First Plan. This directly links Myer’s
short-term goals with the longer-term strategy of the Company.
Performance objectives and targets are set following a rigorous budget setting process at the beginning
of the financial period, while performance against these targets is reviewed following the end of the
financial period.
Governance
When are
performance
targets set and
reviewed?
How is
performance
The Committee determines whether, or the extent to which, each target is satisfied following the end of
the financial period, once the Company’s annual accounts are audited and have been approved by the
measured?
Directors.
The quantum of any TI reward provided will depend on the extent to which the maximum reward is
achieved. Once it has been determined whether each objective has been satisfied, the Committee will
make a recommendation to the Board for approval of the TI awards to be paid to the Executive KMP and
other participants.
The Committee is responsible for assessing whether the performance criteria are met. To help make this
assessment, the Committee receives reports on the Company’s performance from Management. All
proposed TI awards are only made once the Company’s financial performance has been verified by
internal and external audit. The Committee has the discretion to recommend to the Board an adjustment
to any award considering unexpected or unintended circumstances.
When are
incentives
paid?
The component of the TI awards approved by the Board that is not subject to deferral is paid to
participating Executive KMP in October following the Financial Year End and are subject to ongoing
employment at the date of payment.
The deferred component of Executive KMP’s TI is provided in deferred shares, which they will not be able to
trade during the relevant disposal restriction period. See above for details.
Cessation of employment, clawback or change of control
If an individual
Participants leaving employment during the performance year due to resignation, termination for cause,
or gross misconduct are generally not eligible to receive an award under the TI plan.
Participants leaving employment during the performance year for other reasons (e.g. redundancy) will be
entitled to receive a pro-rata award.
The TI plan allows the Board to take any steps that it determines appropriate to recover from the
individual executives any TI reward that was determined to have been an “unfair benefit” as a result of a
material misstatement in, or omission from, the Company’s financial statements or concerning the
satisfaction of KPI applicable to the TI. The provision applies only to those who were executives of the
Company at the time the financial statements were approved by the Board and issued by the Company.
The Board may also adjust the award in cases of fraud, or dishonest or gross misconduct, unsustainable
performance involving high-risk actions and bringing the company into disrepute.
The Board has absolute discretion in relation to the treatment, payment or provision of TI awards on a
change of control, which it would exercise in the best interests of the Company.
ceases
employment
during the
performance
year, will they
receive a
payment?
Does a
“clawback”
apply?
How would a
change of
control affect
TI plan
entitlements?
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42
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Continued
3.3
FY22 Long Term Incentive Plan
Features of the LTI plan applicable in respect of FY22 are outlined in the table below.
Form and purpose of the plan
What is the LTI
plan?
The LTI plan is an incentive that is intended to promote alignment between executives and
shareholder interests over the longer term. Under the LTI plan, performance rights may be offered
annually to the CEO and Managing Director and nominated executives, including Executive KMP. The
employees invited to participate in the plan include executives who are considered to play a leading
role in achieving the Company’s long-term strategic and operational objectives.
How is the LTI plan
delivered?
The LTI plan is delivered via a grant of performance rights. The number of performance rights that
vest is not determined until after the end of the performance period.
The performance rights will therefore not provide any value to the holder between the dates the
performance rights are granted and the end of the vesting period and restriction period (if
applicable), and then only if the performance hurdles are satisfied.
Performance rights do not carry entitlements to ordinary dividends or other shareholder rights until
the performance rights vest and shares are provided. Accordingly, participating executives do not
receive dividends during the vesting period.
How was the
number of
The number of performance rights for each executive was determined as part of the calculation of
total remuneration for an executive role. The Committee determined LTI plan awards by assessing
performance
rights determined?
the quantum required to provide a market competitive total remuneration level, for on target
performance.
The number of performance rights granted was determined by reference to the maximum value of
the grant. The maximum value was determined by a fixed percentage of the executive’s TFC. The CEO
and Managing Director was entitled to a maximum value of 70 percent of TFC in FY22. Other Executive
KMP are entitled to a maximum value of 45 percent of TFC. These opportunity levels are the same as
in FY21, representing a reduction in quantum from the maximum opportunity levels provided to
Executive KMP under the FY20 LTI plan. This reduction was implemented as part of changes to the
remuneration mix and the introduction of the TI plan for FY21 and FY22.
The maximum value divided by the value attributed to the performance right was used to determine
the exact number of performance rights granted. The value attributed to the performance right was
$0.5716, being the volume weighted average price (VWAP) of the Company’s shares over the five
trading days following the release of the Company’s FY21 results (i.e. the 5 trading days commencing
on 16 September 2021).
Vesting and performance hurdles
What is the
performance
period?
The performance period commences at the beginning of the financial period in which the
performance rights are granted. For the performance rights granted under the FY22 LTI plan, the
performance period started on 1 August 2021 and ends on 27 July 2024. Following the end of the
performance period and after the Company has lodged its audited financial results for FY24 with the
ASX, the Board will test the performance hurdles that apply to the FY22 LTI plan offer and will
determine how many performance rights (if any) are eligible to vest.
What are the
performance
hurdles?
The performance measures approved by the Board for the FY22 LTI plan offer were in two stages:
Stage 1 – Absolute TSR gateway - requiring achievement of a positive absolute TSR over the testing
period. If absolute TSR is negative, performance rights lapse.
Stage 2 – Where absolute TSR performance is positive over the performance period, performance
rights will be assessed against underlying EPS and relative TSR:
•
•
50 percent of the award is subject to the EPS hurdle; and
50 percent of the award is subject to the relative TSR hurdle.
Why were the
performance
hurdles chosen?
The hurdles were chosen to align shareholder returns with executive remuneration outcomes over
the three-year performance period and to complement the TIP plan measures.
The Board considers underlying EPS the most effective measure for determining the underlying
profitability of the business. When determining normalised EPS for LTI purposes statutory earnings is
adopted as the base and the Board will allow adjustments to be made for significant items on a
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Continued
case-by-case basis. To the extent a write-down occurs that is considered to have been within
Management’s control, it will form a part of the EPS calculation.
The TSR hurdle was selected to ensure alignment between comparative shareholder return and
reward for Executives. This measure also provides a direct comparison of the Company's
performance over the performance period against a comparator group of companies that would,
broadly, be expected to be similarly impacted by changes in market conditions.
What is the
vesting
framework?
The number of performance rights that vest will depend on how well Myer has performed during the
performance period. For superior performance, 100 percent of the performance rights will vest. Only a
percentage of performance rights will vest for performance below that level. If Myer does not achieve
certain minimum thresholds then all the applicable performance rights will lapse, and no
performance rights will vest.
For the FY22 LTI plan offer, the following vesting hurdles apply:
Stage 1 – Absolute TSR gateway
The absolute TSR hurdle is tested by measuring the Company’s Share price at the beginning and at
the end of the performance period, and the absolute TSR must be positive over the performance
period to progress to Stage 2 of testing. If the absolute TSR over the performance period is negative,
all performance rights granted under the LTI will lapse.
For the purpose of this calculation, the opening value was set at $0.459, this being the 5 trading day
VWAP up to and including 30 July 2021. The end value will be based on the 5 trading day VWAP up to
and including the last day of the performance period.
The Board retains discretion to adjust the absolute TSR performance gateway in exceptional
circumstances.
Stage 2 – Relative TSR and Underlying EPS
Only if Stage 1 testing delivers a positive absolute TSR result, will Stage 2 testing be undertaken. Stage
2 testing focuses executive effort on long-term sustainable performance. Stage 2 requires two
performance hurdles to be met:
a) 50% of the performance rights will be subject to a hurdle based on the Company’s TSR relative to
an agreed peer group across the three-year performance period (Performance Period);
b) 50% of the performance rights will be subject to a hurdle based on the Company’s underlying EPS.
The Stage 2 performance hurdles have been chosen to align with shareholder returns and the
delivery of shareholder value over the long-term. Each of the performance hurdles under Stage 2 will
be assessed separately and apply to different performance rights. This means that both hurdles do
not need to be satisfied for any of the performance rights to vest.
Stage 2 - Performance rights subject to the EPS hurdle (50 percent of the Award)
The EPS hurdle will be tested over the performance period by calculating the compound annual
growth rate in the Company’s underlying EPS using EPS at the end of FY21 as the base year. The
resulting growth rate will be used to determine the level of vesting for the performance rights subject
to the EPS Hurdle.
The table below sets out the percentage of performance rights subject to the EPS Hurdle that can
vest depending on the Company’s growth in underlying EPS. The EPS targets were the same as under
the FY21 LTI plan. The Board believes that the FY22 targets provide appropriate ambition and stretch
for Executives, in light of Myer’s EPS growth in prior years.
Growth in underlying EPS from base year EPS
Below 5% compound annual growth
At 5% compound annual growth
% of performance rights subject to the EPS
Hurdle that will vest
(rounded down to the nearest whole number)
Nil
50%
Between 5% and 12% (inclusive) compound
Straight line pro-rata vesting between 50% and
annual growth
At or above 12% compound annual growth
100%
100%
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Continued
Stage 2 - Performance rights subject to the TSR Hurdle (50 percent of the Award)
The TSR Hurdle will be tested following the end of the performance period by comparing the
Company’s TSR performance over the performance period relative to a set peer group. The peer
group for the FY21 LTI grant includes listed companies from the retail and the consumer services
sector. The constituents are: Accent Group, Adairs, Adore Beauty Group, Baby Bunting, Beacon
Lighting, Best & Less Holdings,
Booktopia Group, Cettire, City Chic Collective, Dusk Group, Endeavour Group, Harvey Norman
Holdings, JB Hi-Fi, Kogan, Lovisa Holdings, Metcash, Michael Hill International, Nick Scali, Premier
Investments, Redbubble, Super Retail Group, Temple & Webster Group, The Reject Shop, Universal
Store Holdings, Wesfarmers and Woolworths. This group is different to that used for the FY21 LTI grant
and was selected following a Board review with a view to ensuring the list contains companies that
are appropriate comparators for Myer for the purposes of assessing company performance during
the LTIP period. Key changes to the peer group include the addition of recently listed consumer
discretionary retailers (including several online retailers) and the removal of several travel
companies and automotive retailers. The comparator group may, at the discretion of the Board, be
adjusted to take into account events during the performance period including, but not limited to,
takeovers, mergers, de-mergers and de-listings.
The table below sets out the percentage of performance rights subject to the TSR Hurdle that can
vest depending on the Company’s relative TSR performance:
TSR performance relative to peer group
Below the 50th percentile
At the 50th percentile
% of performance rights subject to the TSR
Hurdle that will vest
(rounded down to the nearest whole number)
Nil
50%
Between the 50th percentile and the 75th
percentile
Straight line pro-rata vesting between 50% and
100%
At or above the 75th percentile
100%
Are the
No. Each performance hurdle is only tested once at the end of the performance period.
performance
hurdles subject to
retesting?
How are shares
Under the plan, following vesting, the performance rights will be automatically exercised and the
allocated?
Executive is allocated one fully paid ordinary share for each vested performance right.
Do any
Any shares provided on vesting of the performance rights will be subject to a restriction period of one
restrictions apply
once the rights
year, during which they cannot be sold, transferred or otherwise dealt with. A continuous service
restriction will also apply during the restriction period.
vest?
Due to foreign resident tax considerations, for the CEO and Managing Director, the performance
period is 3 years, but the vesting period is 4 years during which a continuous service condition
applies.
Cessation of employment, change of control, clawback, forfeiture, participation in future issues and hedging
The treatment of performance rights on cessation of employment will depend on the date as well as
the circumstances of cessation. Generally, if an executive ceases employment on or before the end
of the restriction period due to resignation, termination for cause or gross misconduct, they will forfeit
any interest in the rights. If employment ceases on or before the end of the restriction period for other
reasons, the executive will retain a pro-rata interest in the vested shares. The calculation is
determined based on time elapsed between the start of the performance period and cessation of
employment. Subject to applicable law, the Board has the discretion to allow a different treatment
(although the discretion is only likely to be exercised in exceptional circumstances).
arrangements
Cessation of
employment
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How would a
change of
control impact
LTI plan
entitlements?
The Board has absolute discretion to allow full or pro-rated accelerated vesting of performance
rights in the event of certain change of control events, and would exercise this discretion as
appropriate considering the circumstances.
Does a
“clawback”
The LTI plan allows the Board to take any steps that it determines appropriate to recover from the
individual Executives any LTI award that vests or may vest if it was determined to have been an
and/or forfeiture
apply?
‘unfair benefit’ as a result of a material misstatement in, or omission from, the Company’s financial
statements or concerning the satisfaction of KPI applicable to the LTI. The provision applies only to
those who were Executives of the Company at the time the financial statements were approved by
the Board and issued by the Company. The Board may also adjust the award in cases of fraud, or
dishonest or gross misconduct, unsustainable performance involving high-risk actions and bringing
the company into disrepute.
The rights and entitlements attaching to performance rights may be adjusted if the Company
undertakes a bonus or rights issue or a capital reconstruction in relation to the Company's shares.
For example, in the event of a rights issue, the number of shares which an executive is entitled to be
allocated on the exercise of performance rights may be changed in a manner determined by the
Myer Board and consistent with the ASX Listing Rules.
How would a
bonus or rights
issue impact
performance
rights under
the LTI plan?
Do any other
restrictions apply
Executives are forbidden from entering into any hedging arrangements affecting their economic
exposure to performance rights or restricted shares.
to performance
rights prior to
vesting or
subject to
restriction?
Executives are also forbidden from entering into transactions or arrangements prohibited under the
Company’s Securities Dealing Policy.
In FY22, Executive KMP and other participating executives received a grant of performance rights. The awards granted may
deliver value to Executives at the end of the three-year performance period, subject to satisfaction of performance hurdles as
set out in the table below.
The following table summarises the FY22 performance rights granted to Executive KMP:
Name
J King
N Chadwick
A Sutton
A Winstanley
Number of
performance
rights granted
Valuation of each
performance
right
at grant date(1)
$
734,779
734,779
312,937
312,937
259,797
259,797
312,937
312,937
0.3760
0.3982
0.3760
0.3982
0.3760
0.3982
0.3760
0.3982
(1)
The valuation is calculated in accordance with AASB 2 Share-based Payment.
Exercise
price
$
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Applicable
hurdles
End of
performance
period
TSR
EPS
TSR
EPS
TSR
EPS
TSR
EPS
27 July 2024
27 July 2024
27 July 2024
27 July 2024
27 July 2024
27 July 2024
27 July 2024
27 July 2024
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46
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Continued
4. Executive KMP Service Agreements
Remuneration and other terms of employment for the CEO and Managing Director, and other Executive KMP are formalised in
service agreements. The termination provisions for Executive KMP, as set out in their service agreements, are described below:
Name
J King
N Chadwick
A Sutton
A Winstanley
Contract type
Rolling contract
Rolling contract
Rolling contract
Rolling contract
Termination notice period
initiated by Executive KMP
payment in lieu of notice,
initiated by Company
Termination notice period, or
12 months
6 months
3 months
6 months
12 months
6 months
6 months
6 months
The agreements also provide for an Executive KMP’s participation in the TI and LTI plans subject to Board approval of their
eligibility and in accordance with the terms and conditions of the respective plans.
In addition, Mr King and Mr Winstanley have been provided with support relating to their relocations, and are entitled to the
following benefits:
• Coverage of costs associated with moving personal and household items, tax services and rental assistance for the first
year of their assignments; and
•
•
Health care coverage and two return flights for self and spouse to and from the USA or the United Kingdom annually, and
other costs related to their Australian residency.
The cost to the Company in providing this support for the period ended 30 July 2022 is summarised in Section 7.
5. Non-Executive Director Remuneration
Remuneration Policy
Myer’s policy regarding Non-Executive Director fees is as follows:
•
•
•
•
•
fees and payments to Non-Executive Directors reflect the demands upon and responsibilities of those Directors;
base fees for Non-Executive Directors include payment for participation on Board Committees; however, an additional
payment is made to those who serve as Chairman on a Committee (excluding the Nomination Committee) to recognise
the additional responsibility and time requirements involved in chairing a Committee;
Non-Executive Directors do not receive performance-based pay. However, they are able to purchase shares in the
Company, which can be acquired on market during approved trading ‘windows’ for share trading consistent with the
Company’s Securities Dealing Policy; and
the Board, on the recommendation of the Human Resources and Remuneration Committee, reviews Non-Executive
Directors' fees and payments at least once a year. As part of that review, the Board considers the advice of independent
remuneration consultants in relation to Chairman’s fees and payments, Non-Executive Directors’ fees and payments, and
payments made in relation to the Chairman of committees or for other specific tasks that may be performed by Directors.
Non-Executive Directors are not entitled to any additional remuneration upon retirement. Superannuation contributions
required by legislation are made from the fee paid to Directors and fall within the aggregate fee pool limit.
Aggregate Fee Pool
Non-Executive Directors’ fees are determined within an aggregate Directors’ fee pool limit as approved from time to time by
Myer shareholders at the AGM. The maximum aggregate limit includes superannuation contributions for the benefit of Non-
Executive Directors and any fees which a Non-Executive Director agrees to sacrifice for other benefits. It does not include
reimbursement of genuine out-of-pocket expenses, genuine special exertions fees paid in accordance with the Company’s
constitution, or certain issues of securities under ASX Listing Rule 10.11 or 10.14, with the approval of shareholders. The current
maximum aggregate fee pool limit is $2,150,000 per annum. The aggregate fee pool limit has not changed since the Company
was listed in November 2009.
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Reductions to Non-Executive Director Fees
There were no changes to the Chairman and Non-Executive Directors’ base annual fees during FY22. As previously disclosed,
there have been a number of reductions since FY17, with the Chairman fee reducing during that period from $400,000 to
$250,000, Non-Executive Directors’ fees reducing from $150,000 to $100,000, the Audit Finance and Risk Committee Chairman
fees reducing from $30,000 to $20,000 and the Human Resources and Remuneration Committee Chairman fees reducing from
$22,500 to $20,000.
During her tenure as Acting Chairman, Ms Stephenson elected not to receive the full Chairman fee and instead only received an
annual Non-Executive Director fee of $120,000. From her appointment as Chairman on 16 September 2021, Ms Stephenson
received the full Chairman fee.
Chairman and Non-Executive Directors’ base annual fees are as detailed below. The same base annual fees will apply for FY23.
Base Annual Fees
Chairman (all inclusive)(1)
Other Non-Executive Directors
Additional annual fees
Audit Finance and Risk Committee – Chairman
Audit Finance and Risk Committee – member
Human Resources and Remuneration Committee – Chairman
Human Resources and Remuneration Committee – member
Nomination Committee – Chairman
Nomination Committee – member
1 August 2021
– 30 July 2022
250,000
100,000
20,000
-
20,000
-
-
-
(1)
As Acting Chairman until 15 September 2021, JoAnne Stephenson received a base annual fee of $120,000.
Minimum Shareholding Policy
Each Non-Executive Director will target the purchase of a shareholding in the Company that, as at the date of the last purchase,
is equivalent to at least one year’s Non-Executive Director’s base fees, progressively over three years from the date of their
appointment, for new Non-Executive Directors, and within three years from April 2018 for Non-Executive Directors appointed
before this date.
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Continued
The table below shows the remuneration amounts recorded in the financial statements in the period for Non-Executive Directors:
Name
Non-Executive Directors
J Stephenson(1)
D Whittle(2)
J Naylor(3)
A Mervis(4)
Former Non-Executive Directors
G Hounsell(5)
J Morrison(6)
L Cattermole AM(7)
Total Non-Executive Directors
FY
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
Myer Holdings
Limited Board &
Committee
Fees
$
Superannuation
$
211,484
108,550
107,950
104,094
107,950
104,094
78,027
-
-
55,347
-
22,282
-
22,282
505,411
416,649
22,266
11,450
12,050
10,982
12,050
10,982
8,716
-
-
5,259
-
2,339
-
2,339
55,082
43,351
Total
$
233,750
120,000
120,000
115,076
120,000
115,076
86,743
-
-
60,606
-
24,621
-
24,621
560,493
460,000
(1) Ms Stephenson was Acting Chairman from 29 October 2020 to 15 September 2021 but during that period elected not to receive the full Chairman Fees and
was instead paid a base fee of $120,000.
(2) Mr Whittle was appointed Chairman of the Audit, Finance and Risk Committee on 29 October 2020.
(3) Ms Naylor was appointed Chairman of the Human Resource and Remuneration Committee on 29 October 2020.
(4) Mr Mervis was appointed as a Non-Executive Director on 20 September 2021.
(5) Mr Hounsell retired as a Non-Executive Director on 28 October 2020.
(6) Ms Morrison retired as a Non-Executive Director on 29 October 2020.
(7) Ms Cattermole AM retired as a Non-Executive Director on 29 October 2020.
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6. Remuneration Governance
6.1 Human Resources and Remuneration Committee
The Board reviews its role, responsibilities, and performance annually to ensure that the Company continues to maintain and
improve its governance standards.
The Board is responsible for ensuring the Company’s remuneration strategy is equitable and aligned with Company
performance and shareholder interests. The Board conducts an annual review of the remuneration strategy of the business. To
assist with this, the Board has established a Human Resources and Remuneration Committee (Committee) made up of Non-
Executive Directors only. The Committee charter is available on the Company’s Investor Centre website.
When making remuneration decisions, the Committee will also consider the Company’s internal succession plan and capability
profile.
The Committee comprises Ms Jacquie Naylor (Committee member from 3 September 2019) as Chairman and Ms JoAnne
Stephenson and Mr David Whittle as members.
In performing its role, the Committee has the responsibility to make recommendations to the Board on:
•
•
•
•
Non-Executive Director fees;
Executive remuneration (for the CEO and Managing Director, and other executives) including specific recommendations on
remuneration packages and other terms of employment;
The overarching remuneration framework including the policy, strategy and practices for fixed reward and both short and
long term incentive plans and performance hurdles; and
The health of the organisation, suitable succession coverage, organisational culture and diversity.
The Committee has been established under rule 8.15 of the Constitution of the Company. Further information on the role of the
Committee, its membership and meetings held throughout the year will be set out in the Corporate Governance Statement
(available on the Company’s website) and the Directors’ Report.
The CEO and Managing Director, the CFO, and the General Manager, People & Culture are regular attendees at the Committee
meetings. Neither the CEO and Managing Director nor the CFO were present during any Committee or Board meetings when
their remuneration was considered or discussed during the financial period.
The Committee must at all times have regard to, and notify the Board as appropriate, of all legal and regulatory requirements,
including any shareholder approvals required in connection with remuneration matters.
The Committee Chairman or, if she is not available, a Committee member, will attend the AGM and be available to answer any
questions from shareholders about the Committee’s activities or, if appropriate, the Company’s remuneration arrangements.
6.2 Use of Remuneration Consultants
To ensure it is fully informed when making remuneration decisions, the Committee draws on services from a range of external
sources, including remuneration consultants where appropriate. The Company’s guidelines on the use of remuneration
consultants aim to ensure the independence of remuneration consultants from Myer’s Management, and include the process for
the selection of consultants and the terms of engagement.
Remuneration consultants are engaged by the Committee Chairman, and report directly to the Committee. As part of this
engagement, an agreed set of protocols to be followed by the consultants, the Committee, and Management, have been
devised that determine the way in which remuneration recommendations are developed and provided to the Board. This
process is intended to ensure that any recommendation made by a remuneration consultant is free from undue influence by
the Executive KMP to whom any recommendations may relate.
No remuneration recommendations were made during FY22 as defined in the Corporations Act 2001.
20
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
50
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2
Myer Annual Report 2022Remuneration Report
REMUNERATION REPORT
Continued
Footnotes
(1) Cash salary includes short-term compensated absences, including any salary sacrifice arrangement implemented by the Executive KMPs, including
additional superannuation contributions.
TI payments relate to program performance and conditions for the year they were earned, not the year of actual payment.
(2)
(3) Non-monetary short term benefits include Fringe Benefits Tax paid by the Company in respect of Company provided car parking up to the end of March
2022 (in accordance with the FBT year), mobile phone expenses and other items referred to in footnotes (9) and (10) for Mr King and Mr Winstanley,
respectively.
51
(4) Other short-term employee benefits include the movement in annual leave accrual.
(5)
(6)
There were no post-employment benefits other than superannuation.
Executive KMPs receive a statutory superannuation contribution up to a threshold limit in line with the ATO published maximum superannuation
(7)
(8)
contribution base, with the exception of Mr King and Mr Winstanley, who do not receive superannuation due to their tax status.
This benefit includes the movement in long service leave accrual.
The share-based payment expense represents the amount expensed for the period based on valuations determined under AASB 2 Share Based Payment.
This expense is based on the fair value at grant date, and reflects expectations of the number of rights and options expected to vest. Where expectations
change in relation to vesting, adjustment is made in the current period to reflect this change. As the equity grant may fully vest, partially vest or not vest at
all, the benefit that the Executive KMP ultimately realises is likely to be different to the amount disclosed in a particular year. The amount disclosed does not
represent cash payments received in the period, and if vesting conditions are not met, may result in reversal of the remuneration amount in a future
period.
(9) Mr King's other short-term benefits include annual leave accrual, a health insurance allowance, relocation expenses for spouse, and return flights home
under the terms of his employment contract.
(10) Mr Winstanley's other short-term benefits include annual leave accrual, a health insurance allowance, and return flights home under the terms of his
employment contract.
22
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
52
REMUNERATION REPORT
Continued
7.1 Unvested Performance Rights and Options
Details of performance rights and options granted to Executive KMP under the previous equity incentive plans that remain
unvested as at 30 July 2022 are set out in the table below.
Value per
instrument
at grant
Vesting date (if holder
Grant type
Grant date
Number of
instruments
date
$
remains employed by a
Myer Group company)
CEO Options (EPS hurdle)(1)
21-Nov-19
2,799,378
$0.18
End of vesting period
Other Executive KMP Options (EPS hurdle)(1)
21-Nov-19
3,499,223
$0.15
End of vesting period
CEO Options (TSR hurdle)(1)
21-Nov-19
2,799,378
$0.16
End of vesting period
Other Executive KMP Options (TSR hurdle)(1)
21-Nov-19
3,499,223
$0.15
End of vesting period
CEO Rights (EPS hurdle)
9-Nov-20
1,721,311
$0.22
End of vesting period
Other Executive KMP Rights (EPS hurdle)
9-Nov-20
2,074,795
$0.22
End of vesting period
CEO Rights (TSR hurdle)
9-Nov-20
1,721,311
$0.19
End of vesting period
Other Executive KMP Rights (TSR hurdle)
9-Nov-20
2,074,795
$0.19
End of vesting period
CEO TIP Rights
15-Dec-20
677,602
$0.57
End of vesting period(2)
Other Executive TIP Rights
15-Dec-20
952,877
$0.57
End of vesting period(2)
CEO Rights (EPS hurdle)
10-Nov-21
734,779
$0.40
End of vesting period
Other Executive KMP Rights (EPS hurdle)
10-Nov-21
885,671
$0.40
End of vesting period
CEO Rights (TSR hurdle)
10-Nov-21
734,779
$0.38
End of vesting period
Other Executive KMP Rights (TSR hurdle)
10-Nov-21
885,671
$0.38
End of vesting period
TIP Rights(3)
Total
16-Feb-22
-
-
End of vesting period(3)
25,060,793
(1)
(2)
(3)
Performance options granted on 21 November 2019 will have an expiry date of 21 November 2023.
From issue date 50% of TIP rights are subject to a one-year service period and 50% are subject to a two-year service period.
The number of rights granted and converted into deferred shares will be determined by dividing the dollar value of the rights component of the TIP award
by the volume weighted average price of the Company’s shares over the five trading days immediately following the release to the market of the
Company’s full year FY22 results. The deferred share will then be subject to a disposal restriction period.
Details of performance rights or options over ordinary shares in the Company currently provided as remuneration and granted
during FY22 to Executive KMP are set out overleaf. Further information on the LTI and TI plan is set out in note H4 of the Financial
Statements.
7.2 Equity Instruments Granted to Executive KMP in FY22
Name
J King
N Chadwick
A Sutton
A Winstanley
Vesting Date
Number of performance
rights granted(1)
Value of performance
rights at grant date(2)
$
Number of rights
vested during the
period
30-Sep-25
30-Sep-24
30-Sep-24
30-Sep-24
1,469,558
625,874
519,594
625,874
840,000
357,750
297,000
357,750
-
-
-
-
(1)
(2)
No performance rights were granted to Non-Executive Directors during the reporting period.
The face value for allocating rights under the FY22 LTI plan was $0.57, based on the volume weighted average price of the Company’s shares over the five
trading days following the release of the Company’s FY21 results.
23
Myer Annual Report 2022Remuneration Report
53
REMUNERATION REPORT
Continued
Deferred Shares – FY22 TI Plan
The number of deferred shares (subject to a disposal restriction) to be issued will be determined by dividing the dollar value of
the deferred shares component of the TI plan award by the volume weighted average price of the Company’s shares over the
five trading days immediately following the release to the market of the Company’s full year FY22 results, and therefore these
shares are not reflected in the above table.
7.3 Shares Provided on Exercise of Rights or Options
The following Non-Executive Directors of the company or Executive KMP were provided ordinary shares as a result of exercise of
options or rights.
As part of the terms of their appointment in 2018, Mr King and Mr Winstanley were granted alignment rights. These rights fully
vested during FY21, and were automatically exercised and converted into Myer ordinary shares following the opening of the
trading window after the release of the FY21 Results.
Name
J King
A Winstanley
Number of ordinary shares provided on
exercise of rights during the period(1)
Value at exercise date(2)
$
2,432,432
555,555
1,386,486
316,666
(1)
(2)
The number of shares provided on exercise of rights are on a one-for-one basis.
The value at exercise date of rights that were granted in prior periods as part of remuneration and were exercised during the period has been determined
as the intrinsic value of the rights at that date. This represents the market value of the shares acquired.
7.4 Performance Options and Performance Rights on Issue
For each grant of options or grant of performance rights included in this report, the percentage of the grant that was paid, or
that vested, in the financial period, and the percentage and value that was forfeited because the service and performance
criteria were not met is set out below. Options and performance rights vest provided the vesting conditions or performance
hurdles are met. No options or performance rights will vest if the hurdles (either service or performance) are not satisfied,
therefore the minimum value of the options or performance rights yet to vest is nil.
Grant date
Equity Vehicle
Vested %
Forfeited %
Maximum total
value of grant yet
to be expensed (1)
16-Feb-22
10-Nov-21
15-Dec-20
9-Nov-20
21-Nov-19
24-Dec-18
16-Feb-22
10-Nov-21
15-Dec-20
9-Nov-20
21-Nov-19
24-Dec-18
16-Feb-22
10-Nov-21
15-Dec-20
9-Nov-20
21-Nov-19
24-Dec-18
Rights(4)
Rights
Rights
Rights
Options(2)
Options(3)
Rights(4)
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Rights
Options(2)
Options(3)
Rights(4)
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Rights
Rights
Options(2)
Options(3)
-
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-
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-
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100%
-
-
-
-
-
100%
-
-
-
-
-
100%
47,254
474,055
64,797
410,777
313,250
53,763
23,870
191,802
32,196
167,978
116,244
18,318
19,816
159,232
26,729
139,454
96,504
15,207
Name
J King
N Chadwick
A Sutton
24
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
54
REMUNERATION REPORT
Continued
A Winstanley
16-Feb-22
10-Nov-21
15-Dec-20
9-Nov-20
21-Nov-19
24-Dec-18
Rights(4)
Rights
Rights
Rights
Options(2)
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100%
23,870
191,802
32,196
167,978
116,244
18,318
Performance options granted on 21 November 2019 will expire on 21 November 2023.
This represents the maximum remaining accounting value of the LTI and TI plan awards (rights and options) as at their grant date.
(1)
(2)
(3)
(4) Rights to deferred shares relating to the FY22 TI plan. The number of rights issued will be determined by dividing the dollar value of the rights component of
The grants under the FY19 LTI plan lapsed following the release of the FY21 results due to failure of the vesting conditions.
the TIP award by the volume weighted average price of the Company’s shares over the five trading days immediately following the release to the market
of the Company’s full year FY22 results.
7.5 Transactions with KMP
Mr King is a director of Raging Bull Group Limited and has a relevant interest in 18 percent of the shares. During the period ended
30 July 2022, Myer Pty Ltd placed orders for apparel totalling $1.4 million with Raging Bull Leisure Limited, whose ultimate parent is
Raging Bull Group Limited.
The orders have been placed on an arm’s length basis under a standard wholesale agreement. As at 30 July 2022, $0.6 million
remains on order and not received, and $0.02 million was owing to Raging Bull Leisure Limited, in accordance with the terms
under the wholesale agreement.
25
Myer Annual Report 2022Remuneration Report
t
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(
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
56
REMUNERATION REPORT
Continued
The number of shares in the Company held during the financial period by each Director of the Company and Executive KMP of
the Company, including their personally related parties are set out below.
Received on exercise of
rights and / or options to
Other changes
Opening balance
shares
during the year
Closing balance
2022
Directors
J Stephenson
D Whittle
J Naylor
Ari Mervis
Executive KMP
J King
N Chadwick
A Sutton
A Winstanley
2021
Directors
J Stephenson
D Whittle
J Naylor
Former Directors
G Hounsell(1)
J Morrison(2)
L Cattermole AM(3)
Executive KMP
J King
N Chadwick
A Sutton
A Winstanley
235,000
266,666
121,000
-
1,150,000
350,000
26,086
500,000
185,000
66,666
121,000
1,400,000
146,788
1,023,232
1,000,000
350,000
26,086
500,000
-
-
-
-
2,432,432
-
-
65,000
-
90,000
250,000
-
-
87,000
300,000
266,666
211,000
250,000
3,582,432
350,000
113,086
Auditor’s Independence Declaration
As lead auditor for the audit of Myer Holdings Limited for the period ended 30 July 2022, I declare that
to the best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
555,555
-
1,055,555
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Myer Holdings Limited and the entities it controlled during the period.
-
-
-
-
-
-
-
-
-
50,000
200,000
-
-
-
-
150,000
-
-
-
235,000
266,666
121,000
-
-
-
1,150,000
350,000
26,086
500,000
Alison Tait Milner
Partner
PricewaterhouseCoopers
Melbourne
15 September 2022
(1) Mr Hounsell retired as Non-Executive Director on 28 October 2020. His holdings for the end of the FY21 period have not been reported in the table.
(2) Ms Morrison retired as Non-Executive Director on 29 October 2020. Her holdings for the end of the FY21 period have not been reported in the table.
(3) Ms Cattermole AM retired as Non-Executive Director on 29 October 2020. Her holdings for the end of the FY21 period have not been reported in the table.
9.
Loans
There were no loans made to Executive KMP or entities related to them, including their personally related parties, at any time
during FY21 or FY22.
10. Dealing in Securities
Under the Securities Dealing Policy, Directors and Senior Executives are prohibited from entering into hedging arrangements with
respect to the Company’s securities. A copy of the Securities Dealing Policy is available on the Myer Investor Centre website.
27
43
Myer Annual Report 2022Remuneration Report
57
Auditor’s Independence Declaration
As lead auditor for the audit of Myer Holdings Limited for the period ended 30 July 2022, I declare that
to the best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Myer Holdings Limited and the entities it controlled during the period.
Alison Tait Milner
Partner
PricewaterhouseCoopers
Melbourne
15 September 2022
43
Myer Annual Report 2022Remuneration ReportDirectors’ Report Remuneration ReportFinancial StatementsYear in Review
58
Financial Statements
for the period ended 31 July 2022
FINANCIAL STATEMENTS
for the period ended 30 July 2022
Contents
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated balance sheet
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
A. Group performance
A1 Segment information
A2 Revenue
A3 Expenses
A4 Income tax
A5 Earnings per share
B. Working capital
B1 Trade and other receivables and prepayments
B2 Inventories
B3 Trade and other payables
C. Capital employed
C1 Property, plant and equipment
C2 Intangible assets
C3 Provisions
C4 Leases
D. Net debt
D1 Cash and cash equivalents
D2 Reconciliation of cash flows from operating activities
D3 Borrowings
E. Risk management
E1 Financial risk management
F. Equity
F1 Contributed equity
F2 Accumulated losses and reserves
F3 Dividends
G. Group structure
G1 Subsidiaries
G2 Deed of cross guarantee
G3 Parent entity financial information
H. Other financial information
H1 Contingencies
H2 Commitments
H3 Related party transactions
H4 Share-based payments
H5 Remuneration of auditors
H6 Events occurring after the reporting period
I. Other accounting policies
59
60
61
62
63
64
64
65
66
67
68
68
68
69
70
71
73
75
75
76
77
83
84
85
86
87
89
90
90
90
91
92
92
93
Myer Annual Report 2022Financial Statements CONSOLIDATED INCOME STATEMENT
for the period ended 30 July 2022
Total sales
Concession sales
Sale of goods
Sales revenue deferred under customer loyalty program
Revenue from sale of goods
Other operating revenue
Cost of goods sold
Operating gross profit
Other income
Selling expenses
Administration expenses
Restructuring, space exit costs and impairment of assets
Finance revenue
Finance costs
Net finance costs
Profit before income tax
Income tax expense
Profit for the period attributable to owners of Myer Holdings Limited
Earnings per share attributable to the ordinary equity holders of the Company:
Basic earnings per share
Diluted earnings per share
The above consolidated income statement should be read in conjunction with the accompanying notes.
59
2022
52 weeks
$m
2,989.8
(606.2)
2,383.6
(43.0)
2,340.6
161.4
(1,356.8)
1,145.2
0.9
(690.9)
(271.0)
(13.2)
171.0
0.3
(99.2)
(98.9)
72.1
(23.1)
49.0
Cents
6.0
5.9
2021
53 weeks
$m
2,658.3
(505.5)
2,152.8
(36.3)
2,116.5
133.6
(1,194.4)
1,055.7
2.4
(648.3)
(239.3)
(7.6)
162.9
0.3
(96.4)
(96.1)
66.8
(20.4)
46.4
Cents
5.7
5.6
Notes
A2
A2
A2
A2
A3
A2
A3
A4
A5
A5
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report
60
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the period ended 30 July 2022
Profit for the period
Other comprehensive income
Items that may be reclassified to profit or loss:
Cash flow hedges
Exchange differences on translation of foreign operations
Other comprehensive income for the period, net of tax
Total comprehensive income for the period attributable to owners of Myer Holdings Limited
Notes
F2
F2
2022
52 weeks
$m
49.0
2021
53 weeks
$m
46.4
0.8
0.9
1.7
50.7
5.9
0.6
6.5
52.9
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Myer Annual Report 2022Financial Statements CONSOLIDATED BALANCE SHEET
as at 30 July 2022
Assets
Current assets
Cash and cash equivalents
Trade and other receivables and prepayments
Inventories
Derivative financial instruments
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Deferred tax assets
Derivative financial instruments
Other non-current assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Derivative financial instruments
Current tax liabilities
Other liabilities
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Provisions
Derivative financial instruments
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Accumulated losses
Reserves
Total equity
The above consolidated balance sheet should be read in conjunction with the accompanying notes.
61
2021
$m
178.6
20.0
305.2
3.1
506.9
318.5
1,224.1
304.4
112.2
0.7
1.3
1,961.2
2,468.1
353.3
156.2
63.1
1.1
16.4
0.2
590.3
66.8
1,579.3
4.8
-
1,650.9
2,241.2
226.9
737.7
(514.0)
3.2
226.9
2022
$m
243.9
28.4
371.4
5.3
649.0
305.0
1,177.8
305.3
111.6
0.3
1.6
1,901.6
2,550.6
429.3
144.2
67.7
0.6
23.8
0.1
665.7
58.0
1,555.0
4.4
0.1
1,617.5
2,283.2
267.4
737.1
(477.3)
7.6
267.4
Notes
D1
B1
B2
E1
C1
C4
C2
A4
E1
B3
C4
C3
E1
D3
C4
C3
E1
F1
F2
F2
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 62
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the period ended 30 July 2022
Balance as at 25 July 2020
Net profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Transactions with owners in their capacity as owners:
Acquisition of treasury shares
Employee share schemes
Balance as at 31 July 2021
Net profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Transactions with owners in their capacity as owners:
Acquisition of treasury shares
Employee share schemes
Dividends Paid
Balance as at 30 July 2022
Notes
F1
F2
F1
F2
F3
Contributed
equity
$m
738.1
-
-
-
Accumulated
losses
$m
(560.4)
46.4
-
46.4
(0.4)
-
(0.4)
737.7
-
-
-
(0.6)
-
-
(0.6)
737.1
-
-
-
(514.0)
49.0
-
49.0
-
-
(12.3)
(12.3)
(477.3)
Reserves
$m
(5.1)
-
6.5
6.5
-
1.8
1.8
3.2
-
1.7
1.7
-
2.7
-
2.7
7.6
Total
$m
172.6
46.4
6.5
52.9
(0.4)
1.8
1.4
226.9
49.0
1.7
50.7
(0.6)
2.7
(12.3)
(10.2)
267.4
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Myer Annual Report 2022Financial Statements CONSOLIDATED STATEMENT OF CASH FLOWS
for the period ended 30 July 2022
Cash flows from operating activities
Receipts from customers (inclusive of goods and services tax)
Payments to suppliers and employees (inclusive of goods and services tax)
Other income
Interest paid
Tax (paid)/received
Net cash inflow from operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangible assets
Lease incentives and contributions received
Interest received
Net cash outflow from investing activities
Cash flows from financing activities
Repayment of borrowings, including transaction costs
Proceeds from borrowings, net of transaction costs
Payments for principal portion of lease liabilities
Dividends paid to equity holders of the parent
Payment for acquisition of treasury shares
Net cash outflow from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at end of period
63
Notes
2022
52 weeks
$m
2021
53 weeks
$m
2,791.1
(2,405.2)
385.9
1.0
(95.4)
(16.4)
275.1
(39.8)
(28.7)
24.3
0.3
(43.9)
(70.0)
56.6
(139.6)
(12.3)
(0.6)
(165.9)
65.3
178.6
243.9
2,515.6
(2,153.1)
362.5
2.7
(95.0)
6.8
277.0
(37.9)
(19.1)
25.1
0.3
(31.6)
(12.6)
-
(140.3)
-
(0.4)
(153.3)
92.1
86.5
178.6
D2
F3
F1
D1
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 64
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
A. Group Performance
This section provides additional information regarding lines in the financial statements that are most relevant to explaining the performance of the Group
during the period, including the applicable accounting policies applied and significant estimates and judgements made.
A1 Segment Information
Management has determined the operating segments based on the reports reviewed by the Chief Executive Officer that are used to make strategic
decisions about the allocation of resources.
The Chief Executive Officer considers the business based on total store and product portfolio, and has identified that the Group operates in Australia in the
department store retail segment.
The Group also undertakes activities outside the department store retail business through its subsidiaries: sass & bide and Marcs and David Lawrence. On
the basis that these subsidiaries represent less than 10% of the total Group's operations and have similar economic characteristics to the department store
retail business, they have not been disclosed as separate reporting segments.
Accounting policy
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating
decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief
Executive Officer.
A2 Revenue
Sales revenue
Total sales
Concession sales
Sale of goods
Sales revenue deferred under customer loyalty program
Revenue from sale of goods
Other operating revenue
Concessions revenue
Other 1
Finance revenue
Interest revenue
Total revenue
2022
52 weeks
$m
2021
53 weeks
$m
2,989.8
(606.2)
2,383.6
(43.0)
2,340.6
138.9
22.5
161.4
0.3
2,502.3
2,658.3
(505.5)
2,152.8
(36.3)
2,116.5
114.7
18.9
133.6
0.3
2,250.4
1. Other includes revenue in relation to gift card non-redemption income, forfeited lay-by deposits and financial services income.
Accounting policy
Total sales value presented in the consolidated income statement represents proceeds from sale of goods (both from the Group and concession operators)
and prior to the deferral of revenue under the Myer one customer loyalty program. Concession sales presented in the income statement represents the sales
proceeds of concession operators within Myer stores. Total sales value is disclosed to show the total sales generated by the Group and provide a basis of
comparison with similar department stores.
Revenue from sale of goods, excluding lay-by transactions, is recognised when the performance obligation has been fulfilled, which is principally at the point
of sale after deducting taxes paid, and does not include concession sales. Goods are sold to the end customer with a right of return within a reasonable
period at the Group’s discretion and in accordance with legislative requirements. A refund liability (included in trade and other payables) and a right to
returned goods (included in trade and other receivables) are recognised for the goods expected to be returned, with a corresponding adjustment to revenue
from sale of goods and cost of goods sold. The assumptions and the estimated amount of returns are based on historical evidence and are reassessed at
the end of each reporting period. Revenue from lay-by transactions is recognised as part of revenue from sale of goods at the date upon which the customer
satisfies all payment obligations and control of the goods has transferred to the customer.
Revenue from sale of goods excludes concession sales in Myer stores on the basis that the inventory sold is owned by the concession operator at the time
of sale and not the Group. The Group's share of concession sales is recognised as revenue within other operating revenue at the time the sale is made.
Gift cards are considered a prepayment for goods or services to be delivered in the future, which creates a future performance obligation for the Group. The
Group recognises a liability for the amount received in advance for the gift card and recognises revenue when the customer redeems the gift card and the
Group fulfils the performance obligation related to the transaction. The Group recognises revenue on the unredeemed value of gift cards and rewards cards
(under the Myer one loyalty program), referred to as non-redemption income. The Group recognises the expected non-redemption amount as revenue in
proportion to the pattern in which the gift card or reward card is utilised by the customer.
Interest income is recognised on a time proportion basis using the effective interest method.
Critical accounting estimates and judgements – customer loyalty program
The Group operates a loyalty program where customers accumulate award points for purchases made which entitle them to discounts on future purchases.
The award points are recognised as a separately identifiable component of the initial sale transaction, by allocating the fair value of the consideration
received between the award points and the other components of the sale such that the award points are recognised at their fair value. Revenue from the
award points is recognised when the points are redeemed. The amount of revenue recognised is based on the number of points redeemed relative to the
total number expected to be redeemed. Award points expire 24 months after the initial sale.
Myer Annual Report 2022Financial Statements NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
A3 Expenses
Profit before income tax includes the following specific expenses:
Employee benefits expenses
Defined contribution superannuation expense
Other employee benefits expenses
Government grant income - wage subsidies1
Depreciation, amortisation and write-off expense
Property, plant and equipment
Intangibles
Right-of-use assets
Finance costs
Interest and finance charges paid/payable for lease liabilities and financial liabilities
Rental expense relating to operating leases
Contingent rentals
Net foreign exchange gains
65
2022
52 weeks
$m
2021
53 weeks
$m
32.9
376.3
-
409.2
57.4
27.8
130.7
215.9
99.2
99.2
1.4
1.4
(12.0)
31.2
379.1
(50.7)
359.6
64.2
31.2
124.1
219.5
96.4
96.4
1.5
1.5
(7.9)
1. In the prior period the Group was eligible to receive payments under the JobKeeper Payment Scheme (Australia) and Wage Subsidy (New Zealand). The
Group only qualified for the first phase of the JobKeeper Payment Scheme which ended on 27 September 2020. The payments received had been
recognised as government grant income because the wage subsidy has been provided with the objective of keeping employees connected with the Group
during the COVID-19 pandemic. During FY21, the Group recognised government grant income totalling $50.7 million, with $19.1 million paid to eligible
employees whose remuneration was lower than the required income threshold under the JobKeeper Payment Scheme. These amounts have been included
in administration and selling expenses in the consolidated income statement.
Restructuring, space exit costs and impairment of assets
The following individually significant items are included within restructuring, space exit costs and impairment of assets in the consolidated income
statement:
Space exit costs and other asset impairments 1
Income tax benefit
Restructuring, space exit costs and impairment of assets, net of tax
2022
52 weeks
$m
13.2
(2.0)
11.2
2021
53 weeks
$m
7.6
(2.3)
5.3
1. Space exit costs and other asset impairments includes costs associated with store closures and space hand backs and other store based asset
impairments.
Accounting policy
The expenses disclosed above are also disclosed in the following sections of the financial statements:
• Employee benefits expenses – refer to note C3
• Depreciation and amortisation expense – refer to note C1 and C2
• Finance costs – refer to note D3 and E1
• Net foreign exchange gains – refer to note F2
Individually Significant Items
Certain items have been separately disclosed and presented as individually significant based on the nature and/or impact these items have on the Group’s
financial performance for the period.
Government Grants
Grants from the government are recognised where there is reasonable assurance that the grant will be received and the Group will comply with all attached
conditions. Government grants relating to expenses are deferred and recognised in profit or loss over the period necessary to match them with the expenses
that they are intended to compensate.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 66
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
A4 Income Tax
(a) Income tax expense
(i) Income tax expense
Current tax
Deferred tax
Income tax expense1
Deferred income tax expense included in income tax expense comprises:
(Increase)/Decrease in deferred tax assets
(ii) Numerical reconciliation of income tax expense to prima facie tax payable
Profit before income tax expense
Tax at the Australian tax rate of 30% (2021: 30%)
Tax effect of amounts which are not deductible (taxable) in calculating taxable income:
Non-deductible asset impairments
Sundry items
Adjustments for current tax of prior periods
Income tax expense1
2022
52 weeks
$m
2021
53 weeks
$m
23.4
(0.3)
23.1
(0.3)
(0.3)
72.1
21.6
1.9
-
23.5
(0.4)
23.1
16.1
4.3
20.4
4.3
4.3
66.8
20.0
-
0.5
20.5
(0.1)
20.4
1. Income tax includes an income tax benefit of $2.0 million (2021: $2.3 million) attributable to the space exit costs and other impairment of assets recorded
during the period. Refer to note A3 for more information.
(b) Deferred tax assets
Deferred tax assets comprise temporary differences attributable to:
Employee benefits
Non-employee provisions and accruals
Amortising deductions
Property, plant, equipment and software
Leases
Trading stock
Total deferred tax assets
Set off of deferred tax liabilities/assets pursuant to set off provisions
Net deferred tax assets
Movement
Carrying amount at beginning of period
Adjustment on change to accounting policy
Charged to income statement
Carrying amount at end of period
(c) Deferred tax liabilities
Deferred tax liabilities comprise temporary differences attributable to:
Brand names
Total deferred tax liabilities
Set off of deferred tax liabilities/assets pursuant to set off provisions
Net deferred tax liabilities
Movement
Carrying amount at beginning of period
Carrying amount at end of period
2022
$m
2021
$m
15.2
5.5
0.3
35.1
122.0
5.3
183.4
(71.8)
111.6
184.0
-
(0.6)
183.4
14.9
6.9
0.1
33.7
123.3
5.1
184.0
(71.8)
112.2
188.3
(0.2)
(4.1)
184.0
2022
$m
2021
$m
71.8
71.8
(71.8)
-
71.8
71.8
71.8
71.8
(71.8)
-
71.8
71.8
Myer Annual Report 2022Financial Statements 67
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
A4 Income Tax (continued)
Accounting policy
The income tax expense or credit for the period is the tax payable on the current period’s taxable income based on the national income tax rate adjusted by
changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts
in the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences and losses at the tax rates expected to apply when the assets are recovered or
liabilities are settled, based on those tax rates which are enacted or substantively enacted. The relevant tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to measure the deferred tax asset or liability. An exemption is made for certain temporary differences if they
arise in a transaction, other than a business combination, that at the time of the transaction did not affect accounting profit or taxable profit or loss. Deferred
tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to
utilise those temporary differences and losses, which is dependent on the generation of future taxable profits. The assumptions regarding future taxable
profits are subject to risk and uncertainty, hence there is a possibility that changes in circumstances will alter expectations, which may impact the amount of
deferred tax assets recognised.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax
balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and
intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax balances attributable to amounts recognised in other comprehensive income or directly in equity are also recognised directly in
other comprehensive income or equity.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation
authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive
of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other
receivables or payables in the balance sheet.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities, which are recoverable from, or
payable to, the taxation authority, are presented as operating cash flow.
A5 Earnings Per Share
(a) Basic earnings per share
Total basic earnings per share attributable to the ordinary equity holders of the Company
(b) Diluted earnings per share
Total diluted earnings per share attributable to the ordinary equity holders of the Company
(c) Reconciliation of earnings used in calculating earnings per share
Earnings used in calculation of basic and diluted EPS attributable to ordinary shareholders
(d) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share
Adjustments for calculation of diluted earnings per share - performance rights and options
Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating
diluted earnings per share
2022
cents
6.0
5.9
2022
$m
49.0
2021
cents
5.7
5.6
2021
$m
46.4
2022
Number
2021
Number
820,574,482 818,929,830
15,649,249 8,740,296
836,223,731 827,670,126
(e) Information concerning the classification of securities
Performance rights and options granted to employees under the Myer Long Term Incentive Plan and Transformation Incentive Plan are considered to be
potential ordinary shares and have been included in the determination of diluted earnings per share to the extent to which they are dilutive. The performance
rights and options granted have not been included in the determination of basic earnings per share. Details relating to performance rights and options are
set out in note H4.
Potential ordinary shares are treated as dilutive when, and only when, their conversion to ordinary shares decreases earnings per share or increases loss
per share.
Accounting policy
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares
outstanding during the financial period, adjusted for bonus elements in ordinary shares issued during the period and excluding treasury shares.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
• the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares; and
• the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential
ordinary shares.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report
68
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
B. Working Capital
This section provides additional information regarding lines in the financial statements that are most relevant to explaining the assets used to generate the
Group's trading performance during the period and liabilities incurred as a result, including the applicable accounting policies applied and significant
estimates and judgements made.
B1 Trade and Other Receivables and Prepayments
Trade receivables
Loss allowance
Other receivables
Prepayments
2022
$m
13.0
(0.1)
12.9
9.1
6.4
15.5
28.4
2021
$m
10.2
(0.5)
9.7
6.3
4.0
10.3
20.0
Fair value and risk exposure
Due to the short-term nature of these receivables, their carrying amount is assumed to approximate their fair value. The maximum exposure to credit risk at
the end of the reporting period is the carrying amount of each class of receivables mentioned above. Information about the Group's exposure to credit risk,
foreign currency risk and interest rate risk in relation to trade and other receivables and the Group's financial risk management policy is provided in note E1.
Accounting policy
Trade receivables are non interest-bearing and are recognised initially at fair value, and subsequently at amortised cost using the effective interest rate
method, less expected loss allowance. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial.
The Group applies the simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for trade and other
receivables based on all possible default events over the expected life of the receivable. The amount of the impairment loss is recognised as an expense in
the consolidated income statement. Subsequent recoveries of amounts previously written off are credited against expenses in the consolidated income
statement.
B2 Inventories
Retail inventories
2022
$m
371.4
2021
$m
305.2
Provision for write-down of inventories to net realisable value amounted to $7.7 million (2021: $7.8 million). This was recognised as an expense during the
period and included in cost of sales in the consolidated income statement.
Accounting policy
Inventories are valued at the lower of cost and net realisable value. Cost is determined using the weighted average cost method, after deducting any
purchase settlement discount and including logistics expenses incurred in bringing the inventories to their present location and condition.
Volume-related supplier rebates and supplier promotional rebates are recognised as a reduction in the cost of inventory and are recorded as a reduction of
cost of goods sold when the inventory is sold.
Critical accounting estimates and judgements - recoverable amount of inventory
Management has assessed the value of inventory that is likely to be sold below cost using past experience and judgement on the likely sell through rates of
various items of inventory, and booked a provision for this amount. To the extent that these judgements and assumptions prove incorrect, the Group may be
exposed to potential additional inventory write-downs in future periods.
B3 Trade and Other Payable
Trade payables
Other payables
Trade and other payables are non-interest bearing.
2022
$m
195.1
234.2
429.3
2021
$m
165.2
188.1
353.3
Accounting policy
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial period which are unpaid. The amounts are
unsecured and are usually paid within 30 to 90 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due
within 12 months from the reporting date.
Myer Annual Report 2022Financial Statements 69
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C. Capital Employed
This section provides additional information regarding lines in the financial statements that are most relevant to explaining the capital investment made that
allows the Group to generate its trading performance during the period and liabilities incurred as a result, including the applicable accounting policies
applied and significant estimates and judgements made.
C1 Property, Plant and Equipment
At 25 July 2020
Cost
Accumulated depreciation and impairment
Net book amount
Period ended 31 July 2021
Carrying amount at beginning of period
Additions
Transfer between classes
Assets written off – cost
Assets written off – accumulated depreciation
Impairment1
Depreciation charge
Carrying amount at end of period
At 31 July 2021
Cost
Accumulated depreciation and impairment
Net book amount
Period ended 30 July 2022
Carrying amount at beginning of period
Additions
Transfer between classes
Assets written off – cost
Assets written off – accumulated depreciation
Impairment1
Depreciation charge
Exchange differences
Carrying amount at end of period
At 30 July 2022
Cost
Accumulated depreciation and impairment
Net book amount
Freehold
land
$m
Freehold
buildings
$m
Fixtures and
fittings
$m
Plant and
equipment
$m
Capital works
in progress
$m
9.6
-
9.6
9.6
-
-
-
-
-
-
9.6
9.6
-
9.6
9.6
-
-
-
-
-
-
-
9.6
9.6
-
9.6
19.5
(6.9)
12.6
12.6
-
-
-
-
-
(0.5)
12.1
19.5
(7.4)
12.1
12.1
-
-
-
-
-
(0.5)
-
11.6
19.5
(7.9)
11.6
522.4
(395.8)
126.6
126.6
7.4
2.2
(9.0)
5.7
0.3
(33.3)
99.9
523.0
(423.1)
99.9
99.9
9.8
7.9
(24.0)
22.5
(0.7)
(31.5)
0.1
84.0
516.8
(432.8)
84.0
460.4
(283.4)
177.0
177.0
21.7
9.8
(4.3)
3.1
-
(27.2)
180.1
487.6
(307.5)
180.1
180.1
15.7
4.1
(37.2)
35.7
(2.5)
(24.6)
-
171.3
470.2
(298.9)
171.3
21.2
-
21.2
21.2
14.2
(18.6)
-
-
-
-
16.8
16.8
-
16.8
16.8
30.8
(19.1)
-
-
-
-
-
28.5
28.5
-
28.5
Total
$m
1,033.1
(686.1)
347.0
347.0
43.3
(6.6)
(13.3)
8.8
0.3
(61.0)
318.5
1,056.5
(738.0)
318.5
318.5
56.3
(7.1)
(61.2)
58.2
(3.2)
(56.6)
0.1
305.0
1,044.6
(739.6)
305.0
1. Impairment relates to assets associated with space handbacks and store closures. Refer to note A3 for more information.
Accounting policy
Property, plant and equipment is stated at cost less depreciation. Cost includes expenditure that is directly attributable to the acquisition of the items. Cost
may also include transfers from equity of any gains/losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future
economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are
charged to profit or loss during the financial period in which they are incurred.
Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate the cost net of their residual values, over their
estimated useful lives, as follows:
• Buildings: 40 years (2021: 40 years)
• Fixtures and fittings: 3 - 12.5 years (2021: 3 - 12.5 years)
• Plant and equipment, including leasehold improvements: 10 - 20 years (2021: 10 - 20 years)
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable
amount (refer to note C2).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 70
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C2 Intangible Assets
At 25 July 2020
Cost
Accumulated amortisation and impairment
Net book amount
Period ended 31 July 2021
Carrying amount at beginning of period
Additions
Transfer between classes
Assets written off – cost
Assets written off – accumulated amortisation
Amortisation charge(1)
Carrying amount at end of period
At 31 July 2021
Cost
Accumulated amortisation and impairment
Net book amount
Period ended 30 July 2022
Carrying amount at beginning of period
Additions
Transfer between classes
Assets written off – cost
Assets written off – accumulated amortisation
Amortisation charge(1)
Carrying amount at end of period
At 30 July 2022
Cost
Accumulated amortisation and impairment
Net book amount
Goodwill
$m
Brand names
and trademarks
$m
Software
$m
492.1
(492.1)
-
-
-
-
-
-
-
-
492.1
(492.1)
-
-
-
-
-
-
-
-
492.1
(492.1)
-
437.3
(197.1)
240.2
240.2
-
-
-
-
-
240.2
437.3
(197.1)
240.2
240.2
-
-
-
-
-
240.2
437.3
(197.1)
240.2
337.7
(261.5)
76.2
76.2
12.7
6.6
(2.0)
1.7
(31.0)
64.2
355.0
(290.8)
64.2
64.2
22.0
7.1
(3.2)
3.0
(28.0)
65.1
380.9
(315.8)
65.1
Lease
rights
$m
18.3
(18.3)
-
-
-
-
-
-
-
-
Total
$m
1,285.4
(969.0)
316.4
316.4
12.7
6.6
(2.0)
1.7
(31.0)
304.4
18.3
(18.3)
-
1,302.7
(998.3)
304.4
-
-
-
-
-
-
-
304.4
22.0
7.1
(3.2)
3.0
(28.0)
305.3
18.3
(18.3)
-
1,328.6
(1,023.3)
305.3
1. Amortisation of $28.0 million (2021: $31.0 million) is included in administration and selling expenses in the consolidated income statement.
Impairment of non-financial assets
AASB 136 Impairment of Assets requires goodwill and intangible assets with an indefinite useful life to be assessed at the end of each reporting period
where there is any indication that an asset may be impaired. A review of indicators of impairment using both external and internal sources of information has
been undertaken.
The brand names arising on the acquisition of the Myer business amounting to $232.8 million (2021: $232.8 million) cannot be allocated to the Group’s
individual cash generating units (CGUs) (the Group’s stores), and hence has been allocated to the Myer business as a whole. The remaining brand name
intangible asset with an indefinite useful life has been allocated to the Marcs David Lawrence business totalling $7.4 million (2021: $7.4 million).
AASB 136 Impairment of Assets requires goodwill and intangible assets with an indefinite useful life to be tested annually for impairment. As a result during
the period, the recoverable amount of the assets relating to this CGU have been assessed using a value-in-use discounted cash flow model. This model
uses cash flow projections based on financial forecasts approved by management covering a five-year period. Cash flows beyond five-year periods are
extrapolated using a terminal growth rate.
Key assumption
2022
2021
Approach used to determine value
Weighted average discount rate (pre-tax)
11.9%
12.8%
Terminal growth rate
1.7%
1.7%
Average EBITDA margin
11.9%
12.5%
The pre-tax discount rate is sourced from observable market information
and is risk-adjusted relative to the risks associated with the net pre-tax
cash flows being achieved.
This is the weighted average growth rate used to extrapolate cash flows
beyond the five-year forecast period.
Average annual EBITDA margin over the five-year forecast period,
applied to sales forecast consistent with external market forecasts. The
average annual EBITDA margin is based on external sources of
information, past performance and management’s expectations. This
assumption incorporates anticipated market conditions, sales channel
performance, and management’s expectations of future cost saving
initiatives.
Myer Annual Report 2022Financial Statements
71
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C2 Intangible Assets (continued)
Impairment of non-financial assets (continued)
The headroom approximates 34% of the CGU's net carrying value. The recoverable amount is based on approved cashflow projections, however the
projections can be influenced by market and macro economic conditions.
The recoverable amount is highly sensitive to changes in the average EBITDA margin assumption. For the recoverable amount to approximate the carrying
value, a 186 basis points decrease in the average EBITDA margin would need to occur. Any reasonable possible change in other key assumptions would
not result in an impairment.
During the period, a review of the carrying value for each Myer store was undertaken and no indicators of impairment were identified.
Accounting policy
(i) Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if
events or changes in circumstances indicate they might be impaired. Other non-current assets are reviewed for impairment whenever events or changes in
circumstances indicate the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount
exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of
assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the
cash inflows from other assets or group of assets (cash generating units). For store assets, the appropriate cash generating unit is an individual store. Non-
financial assets other than goodwill that have previously suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.
(ii) Goodwill
Goodwill is measured as described below under business combinations. Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is
not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is
carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the
entity sold.
(iii) Brand names and trademarks
The useful life of brands are assessed on acquisition. The brands which are not considered to have foreseeable brand maturity dates have been assessed
as having indefinite useful lives as there is a view that there is no foreseeable limit to the period over which key brands are expected to generate net cash
inflows for the entity. These brands are therefore not amortised. Instead, these brand names are tested for impairment annually, or more frequently if events
or changes in circumstances indicate that they might be impaired, and are carried at cost less accumulated impairment losses.
(iv) Computer software
All costs directly incurred in the purchase or development of major computer software or subsequent upgrades and material enhancements are capitalised
as intangible assets where the Group has control and obtains all the future economic benefit from the underlying asset. Direct costs may include internal
payroll and on-costs for employees directly associated with the project. Costs incurred on computer software maintenance or during the planning phase are
expensed as incurred. Costs paid to the suppliers for Software-as-a-Service arrangements to significantly customise cloud-based software for the Group are
recorded as a prepayment for services and amortised over the expected renewable term of the arrangement. Computer software is amortised over the
period of time during which the benefits are expected to arise, initially being up to 10 years. The assets' residual values and useful lives are reviewed
annually and adjusted if appropriate, which may result in a useful life outside of this period.
(v) Lease rights
Lease rights represent the amount paid up front to take over store site leases from the existing lessee where such payments are in addition to the ongoing
payment of normal market lease rentals. Lease rights are amortised over the term of the lease plus any renewal options reasonably certain to be utilised at
the time of acquisition of the lease rights.
Critical accounting estimates and judgements - impairment
Goodwill and intangible assets that have an indefinite life are tested annually for impairment, or more frequently if there are indicators of impairment, in
accordance with the accounting policy noted above. Goodwill and certain intangibles are tested for impairment at the level of the Group as a whole, using
value-in-use calculations, which requires an estimation of the recoverable amount.
C3 Provisions
Current
Employee benefits
Restructuring1
Workers' compensation 2
Other3
Non-current
Employee benefits
Other3
2022
$m
49.0
7.2
9.0
2.5
67.7
3.2
1.2
4.4
2021
$m
49.7
2.9
8.7
1.8
63.1
4.8
-
4.8
1. Restructuring - the restructuring provision relates to the costs associated with store closures and space hand backs committed but not yet paid. Refer
to note A3 for more information.
2. Workers' compensation - the amount represents a provision for workers' compensation claims in certain states, for which the Group is self insured.
3. Other - the amount includes the provision for make good associated with leased premises.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 72
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C3 Provisions (continued)
Movement in provisions
Movement in each class of provision during the financial period, other than employee benefits, are set out below:
2022
Carrying amount at beginning of period
Additional provisions recognised
Amounts utilised
Carrying amount at end of period
Workers'
compensation
$m
Restructuring
$m
8.7
2.0
(1.7)
9.0
2.9
10.9
(6.6)
7.2
Other
$m
1.8
13.2
(11.3)
3.7
Total
$m
13.4
26.1
(19.6)
19.9
Amounts not expected to be settled within the next 12 months
The current provision for employee benefits includes accrued annual leave and long service leave. For long service leave it covers all unconditional
entitlements where employees have completed the required period of service. The entire annual leave amount and current portion of the long service leave
provision is presented as current since the Group does not have an unconditional right to defer settlement for any of these obligations. However, based on
past experience, the Group does not expect all employees to take the full amount of accrued long service leave or require payment within the next 12
months. The following amounts reflect leave that is not expected to be taken or paid within the next 12 months.
Current long service leave obligations expected to be settled after 12 months
2022
$m
18.3
2021
$m
21.8
Accounting policy
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of
resources will be required to settle the obligation and the amount has been reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of
obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations
may be small.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the
reporting period. The discount rate used to determine the present value reflects current market assessments of the time value of money and the risks
specific to the liability.
The Group is self-insured for costs relating to workers’ compensation and general liability claims in certain states. Provisions are recognised based on
claims reported, and an estimate of claims incurred but not yet reported, prior to balance date. These provisions are determined utilising an actuarially
determined method, which is based on various assumptions including but not limited to future inflation, average claim size and claim administrative
expenses. These assumptions are reviewed annually and any reassessment of these assumptions will affect the workers’ compensation expense.
Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12 months after the end of the period in
which the employees render the related service are recognised in respect of employees' services up to the end of the reporting period and are measured at
the amounts expected to be paid when the liabilities are settled. The liability for annual leave is recognised in the provision for employee benefits. All other
short-term employee benefit obligations are presented as payables.
(ii) Other long-term employee benefit obligations
The liability for long service leave which is not expected to be settled within 12 months after the end of the period in which the employees render the related
service is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of
services provided by employees up to the end of the reporting period using the projected unit credit method. Consideration is given to expected future wage
and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the end of the
reporting period on corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to defer settlement for at least 12
months after the reporting date, regardless of when the actual settlement is expected to occur.
(iii) Profit sharing and bonus plans
The Group recognises a liability and an expense for bonuses and profit sharing based on a formula that takes into consideration the profit attributable to the
Group’s shareholders after certain adjustments. The Group recognises a provision where contractually obliged or where there is a past practice that has
created a constructive obligation.
(iv) Termination benefits
Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in
exchange for these benefits. The Group recognises termination benefits when it is demonstrably committed to either terminating the employment of current
employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage
voluntary redundancy. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.
Myer Annual Report 2022Financial Statements NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C4 Leases
The Group has lease agreements for properties and various items of equipment used in its operations. The carrying amounts of the right-of-use assets and
movements during the period are set out below:
73
At 25 July 2020
Additions, modifications and other reassessments
Depreciation
At 31 July 2021
At 31 July 2021
Additions, modifications and other reassessments
Depreciation
At 30 July 2022
The carrying amounts of the lease liabilities and movements during the period are set out below:
At 25 July 2020
Additions, modifications and other reassessments
Cash payments
Interest expense
At 31 July 2021
Current
Non-current
At 31 July 2021
Additions, modifications and other reassessments
Cash payments
Interest expense
At 30 July 2022
Current
Non-current
The following amounts have been recognised in the consolidated income statement during the period:
Depreciation of right-of-use assets1
Interest expense on lease liabilities 1
Short-term leases expense2
Variable lease payments3
Property leases
$m
1,272.3
81.7
(129.9)
1,224.1
Equipment
leases
$m
0.3
-
(0.3)
-
1,224.1
90.4
(136.7)
1,177.8
-
-
-
-
Property leases
$m
1,794.3
81.1
(227.1)
87.2
1,735.5
156.2
1,579.3
Equipment
leases
$m
0.4
-
(0.4)
-
-
-
-
1,735.5
103.3
(227.4)
87.8
1,699.2
144.2
1,555.0
-
-
-
-
-
-
-
Total
$m
1,272.6
81.7
(130.2)
1,224.1
1,224.1
90.4
(136.7)
1,177.8
Total
$m
1,794.7
81.1
(227.5)
87.2
1,735.5
156.2
1,579.3
1,735.5
103.3
(227.4)
87.8
1,699.2
144.2
1,555.0
2022
52 weeks
$m
130.7
86.4
0.5
0.3
217.9
2021
53 weeks
$m
124.1
85.5
3.8
1.5
214.9
1. The depreciation and interest expense associated with certain leases is recognised in cost of sales in the consolidated income statement.
2. Short-term leases expense are included in selling and administration expenses in the consolidated income statement.
3. Some property leases contain variable payment terms that are linked to sales generated from a store and are recognised in selling expenses in the
consolidated income statement in the period in which the condition that triggers those payments occurs.
COVID-19 related rent concessions
The Group has adopted the practical expedient for rent concessions and elected not to account for changes to lease payments negotiated as a
consequence of COVID-19 as a lease modification. During the period, the total rent concessions recognised as a reduction in selling and administration
expenses in the consolidated income statement was $14.9 million (2021: $17.1 million). This has been reflected as an adjustment to the carrying amount of
the lease liabilities in additions, modifications and other reassessments in the movement table above.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 74
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
C4 Leases (continued)
Accounting policy
The Group leases various retail stores, distribution centres and offices. Rental contracts are typically made for fixed periods but may have extension options.
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which
comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs
incurred and any estimated restoration costs, less any lease incentives received. The right-of-use asset is subsequently depreciated on a straight-line basis
from the commencement date to the end of the lease term. The right-of-use asset can be reduced by impairment losses, if any, and adjusted for certain
remeasurements of the lease liability.
The lease liability is measured at the present value of the lease payments that are not paid at the commencement date, discounted using the Group's
incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise of fixed payments and variable payments that are
based on an index or rate.
Some property leases contain variable payment terms that are linked to sales generated from a store. Variable lease payments that depend on sales are
recognised in profit or loss in the period in which the condition that triggers those payments occurs.
Payments associated with short-term leases and leases of low-value assets, such as IT equipment, are recognised on a straight-line basis as an expense in
profit or loss. Short-term leases are leases with a lease term of 12 months or less.
Critical accounting estimate - Determining the lease term
Extension options are included in a number of leases across the Group. In determining the lease term, the Group considers all facts and circumstances that
create an economic incentive to exercise an extension option. Extension options are only included in the lease term if the lease is reasonably certain to be
extended. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this
assessment, and is within the control of the Group.
Myer Annual Report 2022Financial Statements NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
D. Net Debt
This section provides additional information regarding lines in the financial statements that are most relevant to explaining the net debt position and
structure of the Group's borrowings for the period, which are key to financing the Group's activities both now and for the future.
The net debt/(cash) of the Group as at 30 July 2022 and 31 July 2021 is as follows:
75
Borrowings
Less: cash and cash equivalents
Net cash at end of period (excluding lease liabilities)
Plus: lease liabilities
Net debt at end of period
The movement in net cash excluding lease liabilities is as follows:
Opening balance
Net increase in cash and cash equivalents
Repayment of borrowings, including transaction costs
Proceeds from borrowings, net of transaction costs
Other non-cash movements
Closing balance
D1 Cash and Cash Equivalents
Cash on hand
Cash at bank
2022
$m
58.0
(243.9)
(185.9)
1,699.2
1,513.3
(111.8)
(65.3)
(70.0)
56.6
4.6
(185.9)
2022
$m
2.1
241.8
243.9
2021
$m
66.8
(178.6)
(111.8)
1,735.5
1,623.7
(7.9)
(92.1)
(12.6)
-
0.8
(111.8)
2021
$m
2.0
176.6
178.6
Accounting policy
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial
institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value, and bank overdrafts.
D2 Reconciliation of Cash Flows from Operating Activities
Profit for the period
Depreciation, amortisation and impairment, including lease incentives and contributions
Interest income
Interest expense
Share-based payments expense
Net exchange differences
Change in operating assets and liabilities
(Increase)/decrease in trade and other receivables and prepayments
(Increase)/decrease in inventories
(Increase)/decrease in deferred tax assets
(Increase)/decrease in derivative financial instruments
Increase/(decrease) in trade and other payables
Increase/(decrease) in current tax payable
Increase/(decrease) in provisions
(Decrease)/increase in other liabilities
Net cash inflow from operating activities
2022
52 weeks
$m
49.0
207.2
(0.3)
4.6
3.9
0.9
(10.0)
(61.6)
(0.5)
(6.2)
78.0
7.4
2.8
(0.1)
275.1
2021
53 weeks
$m
46.4
210.3
(0.3)
2.9
2.3
0.6
34.5
(54.7)
3.7
5.3
(6.8)
23.5
9.3
-
277.0
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 76
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
D3 Borrowings
(a) Structure of debt
The debt funding of the Group at 30 July 2022 is an Asset Based Loan (ABL) syndicated facility, which contains a term loan tranche and a revolving credit
tranche. The maximum facility size is $215 million and availability fluctuates in line with a borrowing base of nominated assets, including specified inventory
and intangibles, less allowances and certain liabilities. This facility was established on 28 November 2021 and the Term Loan was drawn down on 3
December 2021. As at 30 July 2022, the following amounts were drawn:
Non-current
Bank loans
Less: transaction costs
Borrowings
30 July
2022
$m
65.0
(7.0)
58.0
31 July
2021
$m
70.0
(3.2)
66.8
The terms and conditions of the Group's syndicated facility is as follows:
Term loan - Tranche A1
Revolving Credit - Tranche B2
Total syndicated facility
Amount3,4
$65 million
$150 million
$215 million
Term
4 years
4 years
Expiry date
3 December 2025
3 December 2025
1. Tranche A is a non-amortising term loan and is required to be fully drawn during the term.
2. Tranche B is a revolving credit and may be redrawn during the term.
3. The syndicated facility available at 30 July 2022 was $142.2 million, at which time the company also had $243.9 million cash on hand.
4. Subsequent to the end of the financial period, the available syndicated facility increased to $197.9 million in line with the seasonal and fluctuating nature
of the ABL facility.
(b) Security
The ABL facility is secured, subject to various representations, undertakings, events of default and review events.
(c) Fair value
The fair value of existing borrowings approximates their carrying amount, as the impact of discounting is not significant.
(d) Risk exposures
Details of the Group's exposure to risks arising from borrowings are set out in note E1.
(e) Debt covenants
Under the terms of the ABL facility, the Group is not required to comply with any financial covenant unless it utilises more than 90% of the available facility.
The Group did not utilise more than 90% of the available borrowing base at any time in the period ended 30 July 2022, and therefore testing of compliance
with the financial covenant was not required.
Accounting policy
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference
between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the
effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable
that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is
probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the
facility to which it relates.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the
reporting period.
Borrowing costs
Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required to complete and prepare the
asset for its intended use or sale. Other borrowing costs are expensed.
Myer Annual Report 2022Financial Statements 77
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E. Risk Management
This section provides information relating to the Group's exposure to various financial risks, how they could affect the Group's financial position and
performance and how these risks are managed.
E1 Financial Risk Management
The Group's activities expose it to a variety of financial risks: market risk (including foreign exchange and interest rate risk), credit risk and liquidity risk. The
Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the
financial performance of the Group. The Group uses derivative financial instruments such as forward foreign exchange contracts and interest rate swaps to
hedge certain risk exposures. Derivatives are exclusively used for hedging purposes and are not used as trading or other speculative instruments.
The Group’s financial risk management is predominantly controlled by the centralised Group Treasury function under the Group’s financial risk management
policies approved by the Board of Directors. The Group Treasury function is responsible for the identification and management of financial risks, with the co-
operation of other Group functions. The Board provides principles for overall risk management, as well as policies covering specific areas such as foreign
exchange risk, interest rate risk, and use of financial instruments and non-derivative financial instruments.
Where all relevant criteria are met, hedge accounting is applied to remove the accounting mismatch between the hedging instrument and the hedged item.
This will effectively result in recognising interest expense at a fixed interest rate for the hedged floating rate borrowings and inventory at a fixed foreign
currency rate for the hedged purchases.
Financial Instruments
The Group holds the following financial instruments, classified under the categories in the table below:
At 30 July 2022
Financial assets
Cash and cash equivalents
Trade and other financial receivables
Derivative financial instruments
Total financial assets
Financial liabilities
Trade and other financial payables1
Borrowings
Lease liabilities
Derivative financial instruments
Total financial liabilities
At 31 July 2021
Financial assets
Cash and cash equivalents
Trade and other financial receivables
Derivative financial instruments
Total financial assets
Financial liabilities
Trade and other financial payables1
Borrowings
Lease liabilities
Derivative financial instruments
Total financial liabilities
Notes
Total Amortised cost
$m
$m
Fair value
through OCI
$m
D1
B1
E1
B3
D3
C4
E1
D1
B1
E1
B3
D3
C4
E1
243.9
22.0
5.6
271.5
329.4
58.0
1,699.2
0.7
2,087.3
178.6
16.1
3.8
198.5
262.2
66.8
1,735.5
1.1
2,065.6
243.9
22.0
-
265.9
329.4
58.0
1,699.2
-
2,086.6
178.6
16.1
-
194.7
262.2
66.8
1,735.5
-
2,064.5
-
-
5.6
5.6
-
-
-
0.7
0.7
-
-
3.8
3.8
-
-
-
1.1
1.1
1. Trade and other financial payables comprise trade payables, other financial payables and accruals.
(a) Market risk
(i) Foreign exchange risk
The Group is exposed to foreign exchange risk when there is mismatch between the currencies in which future commercial transactions and assets and
liabilities recognised are denominated, and the respective functional currency of the Group companies.
The focus of the Group’s foreign exchange risk management activities is on the transaction exposures that arise on the sourcing and purchasing of
inventory, with these transactions primarily denominated in United States Dollar (USD) and some denominated in Euro (EUR). This risk is hedged with the
objective of minimising the volatility of the Australian Dollar (AUD) cost of highly probably forecast inventory purchases.
The Group’s financial risk management policy is to hedge forecast USD and EUR cash flows for inventory purchases, up to 18 months in advance. The
amount of hedging required is dependent on the timing of the settlement of the forecast inventory purchases, with a higher percentage required to be
hedged for inventory purchases with an earlier settlement.
The Group uses forward foreign exchange contracts to hedge its exposure to foreign currency risk. The Group designates the forward rate of foreign
currency forwards to hedge its currency risk. The Group’s policy is for the critical terms of the forward foreign exchange contracts to align with the hedged
item.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 78
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E1 Financial Risk Management (continued)
(a) Market risk (continued)
(i) Foreign exchange risk (continued)
At the end of the reporting period, the Group is holding the following forward foreign exchange contracts:
Carrying amount - Derivative Financial Instruments (Asset)
Carrying amount - Derivative Financial Instruments (Liability)
Notional amount
Maturity date
Change in fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness
Change in value of hedged item used to determine hedge effectiveness
Weighted average hedged rate (AUD/USD)
Weighted average hedged rate (AUD/EUR)
Exposure
At the end of the reporting period, the Group’s exposure to foreign exchange risk, expressed in AUD, was as follows:
2022
$m
5.6
0.7
161.6
Aug 2022 -
Oct 2023
2.3
(2.3)
0.703
0.680
2021
$m
3.8
1.1
169.9
Aug 2021 -
Nov 2022
6.1
(6.1)
0.737
0.620
Cash and cash equivalents
Trade payables
Forward exchange contracts
USD
$m
0.9
42.9
159.6
2022
EURO
$m
1.0
-
2.0
Other
$m
4.0
-
-
USD
$m
9.5
21.0
168.6
2021
EURO
$m
4.1
0.1
1.3
Other
$m
4.5
0.2
-
Sensitivity
As shown in the table above, the Group is primarily exposed to changes in USD/AUD and EUR/AUD exchange rates. The table below shows the impact of
reasonably possible foreign exchange movements in the USD and EUR against the AUD and the effect this would have on the measurement of the financial
instruments denominated in these currencies:
Currency
United States Dollar
United States Dollar
Euro
Euro
Sensitivity assumption
+10%
-10%
+10%
-10%
Impact directly on equity
2022
$m
15.4
(12.2)
0.2
(0.1)
2021
$m
16.5
(13.5)
0.1
(0.1)
(ii) Interest rate risk
The Group is exposed to interest rate risk from floating rate long-term borrowings. The Group’s policy is to maintain an appropriate mix between fixed and
floating rate borrowings through the use of interest rate swap contracts. This risk is managed through the forecasting of expected borrowings to determine
the level of exposure to floating rates.
Exposure
At the end of the reporting period, the Group’s exposure to interest rate risk was as follows:
Cash and cash equivalents
Floating rate borrowings
2022
$m
243.9
58.0
2021
$m
178.6
66.8
At the end of the reporting period the Group held no interest rate swap contracts as the interest rate risk associated with borrowings is managed against the
interest rate earned on operating cash held.
Myer Annual Report 2022Financial Statements 79
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E1 Financial Risk Management (continued)
(a) Market risk (continued)
(ii) Interest rate risk (continued)
Sensitivity
Applying a sensitivity of 100 basis points to the Group's period end floating interest rate results in an immaterial impact on post tax profit and equity. This
assumes that the change in interest rates is effective from the beginning of the financial period and the net debt position and fixed/floating mix is constant
over the period. However, interest rates and the debt profile of the Group are unlikely to remain constant and therefore the above sensitivity analysis will be
subject to change.
(iii) Hedge ineffectiveness
Hedge ineffectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments to ensure that
an economic relationship exists between the hedged item and hedging instrument.
For hedges of foreign currency purchases, the group enters into hedge relationships where the critical terms of the hedging instrument match exactly with
the terms of the hedged item. The Group therefore performs a qualitative assessment of effectiveness. If changes in circumstances affect the terms of the
hedged item such that the critical terms no longer match exactly with the critical terms of the hedging instrument, the Group uses the hypothetical derivative
method to assess effectiveness.
(b) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. This arises
primarily from the following assets: cash and cash equivalents, trade and other receivables and derivative financial instruments.
Group Treasury manages credit risk from banks and financial institutions, in accordance with Board approved policy. The policy is to limit the Group’s loss
from default by any one counterparty by dealing only with banks and financial institution counterparties whose long-term credit rating is at or above an 'A'
rating.
Trade and other receivables balances outstanding with third parties are primarily ad-hoc in nature and the credit quality of the third party is assessed by
taking into account its financial position, past experience and other relevant factors.
Sales to retail customers are primarily required to be settled in cash or using major credit cards, mitigating credit risk. There are no significant
concentrations of credit risk, whether through exposure to individual customers, specific industry sectors and/or regions.
Exposure
At the end of the reporting period, the maximum credit risk exposure is the carrying value of the financial assets below:
Cash and cash equivalents
Trade and other financial receivables
Derivative financial instruments - assets
2022
$m
243.9
22.0
5.6
2021
$m
178.6
16.1
3.8
Trade and other receivables
The Group applies the AASB 9 simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for all trade and
other receivables.
To measure the expected credit losses, trade and other receivables have been grouped based on shared credit risk characteristics and the days past due.
The expected credit loss rates are based on historical observed default rates, adjusted to reflect current and forward looking information on macroeconomic
factors affecting the ability of customers to settle the receivables.
Trade receivables are written off when there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include,
amongst others, the failure of a debtor to engage in a repayment plan with the Group. Refer to note B1 for more information.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 80
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E1 Financial Risk Management (continued)
(c) Liquidity risk
The Group adopts a prudent liquidity risk management strategy by seeking to maintain sufficient cash and availability of funding through an adequate
amount of committed credit facilities to meet financial obligations as and when they fall due. The Group’s objective is to maintain flexibility in funding given
the seasonal nature of the retail business.
The Group monitors forecast and actual cash flows and performs sensitivity analysis, to ensure at all times there is an appropriate minimum level of liquidity
available through committed undrawn borrowing facilities and cash and cash equivalents.
Financing arrangements
The Group had access to the following undrawn borrowing facilities at the end of the reporting period:
Floating rate
Expiring within one year
Expiring beyond one year1
2022
$m
-
44.9
44.9
2021
$m
-
217.6
217.6
1. The ABL maximum facility size is $215 million and fluctuates in line with a borrowing base of nominated assets, including specified inventory and
intangibles, less allowances and certain liabilities. The syndicated facility available at 30 July 2022 was $142.2 million with $44.9 million accessible, at which
time the company also had $243.9 million cash on hand. Refer to note D3 for more information on the syndicated facility.
Maturities of financial liabilities
The tables below analyse the Group's financial liabilities into relevant maturity groupings based on their contractual maturities for:
(a) all non-derivative financial liabilities; and
(b) net and gross settled derivative financial instruments for which the contractual maturities are essential for an understanding of the timing of the
cash flows.
The amounts disclosed in the table are the contractual undiscounted cash flows and therefore may not equal their carrying amount. Balances due within 12
months equal their carrying amounts as the impact of discounting is not significant.
Contractual maturities of
financial liabilities
Less than
6 months
6 - 12
months
Between
1 and 2
years
Between
2 and 5
years
Over 5
years
Total
contractual
cash flows
$m
$m
$m
$m
$m
$m
2022
Non-derivatives
Trade and other payables
Borrowings
Lease liabilities
Total non-derivatives
Derivatives
Gross settled
- (inflow)
- outflow
Total derivatives
2021
Non-derivatives
Trade and other payables
Borrowings
Lease liabilities
Total non-derivatives
Derivatives
Gross settled
- (inflow)
- outflow
Total derivatives
329.4
3.9
105.7
439.0
(89.3)
86.0
(3.3)
262.2
11.3
108.2
381.7
(84.3)
84.3
-
-
3.9
108.8
112.7
(65.6)
64.2
(1.4)
-
10.6
104.2
114.8
(70.3)
68.3
(2.0)
-
7.7
211.5
219.2
(11.6)
11.4
(0.2)
-
50.8
203.3
254.1
(18.0)
17.3
(0.7)
-
75.4
624.7
700.1
-
-
-
-
-
568.4
568.4
-
-
-
-
-
1,172.7
1,172.7
-
-
-
-
-
1,246.3
1,246.3
-
-
-
329.4
90.9
2,223.4
2,643.7
(166.5)
161.6
(4.9)
262.2
72.7
2,230.4
2,565.3
(172.6)
169.9
(2.7)
The amount disclosed for variable rate instruments is determined by reference to the interest rate at the last re-pricing date.
Carrying
amount
(assets)/
liabilities
$m
329.4
65.0
1,699.2
2,093.6
(5.6)
0.7
(4.9)
262.2
70.0
1,735.5
2,067.7
(3.9)
1.2
(2.7)
Myer Annual Report 2022Financial Statements NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E1 Financial Risk Management (continued)
(d) Fair value measurements
The Group has the following derivative financial instruments:
Current assets
Forward foreign exchange contracts
Total current derivative financial instrument assets
Non-current assets
Forward foreign exchange contracts
Total non-current derivative financial instrument assets
Current liabilities
Forward foreign exchange contracts
Total current derivative financial instrument liabilities
Non-current liabilities
Forward foreign exchange contracts
Total non-current derivative financial instrument liabilities
81
2022
$m
2021
$m
5.3
5.3
0.3
0.3
0.6
0.6
0.1
0.1
3.1
3.1
0.7
0.7
1.1
1.1
-
-
The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
• Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities;
• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liabilities either directly (as prices) or indirectly
derived from prices; and
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
All of the Group’s financial instruments were valued using the Level 2 technique, with no transfers between levels during the period.
The fair value of forward foreign exchange contracts is determined using the present value of future cash flows based on the forward exchange rates at the
end of the reporting period. The fair value of interest rate swaps is determined using the present value of the estimated future cash flows based on
observable yield curves.
Accounting policy - Financial assets and liabilities
Classification
The group classifies its financial assets in the following measurement categories:
• those to be measured subsequently at fair value (either through OCI or through profit or loss); and
• those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in equity instruments that are not held for
trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair
value through other comprehensive income (FVOCI).
Initial recognition and measurement
At initial recognition, the group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss (FVPL),
transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in
profit or loss.
(i) Financial assets at amortised cost (debt instruments)
Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at
amortised cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on
derecognition is recognised directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment
losses are recognised in profit or loss. Trade receivables that do not contain a significant financing component or for which the Group has applied the
practical expedient are measured at the transaction price determined under AASB 15.
(ii) Financial assets at fair value through OCI (debt instruments)
Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of
principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or
losses, interest income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is derecognised, the
cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from
these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other
gains/(losses) and impairment expenses are recognised in profit or loss.
(iii) Financial assets at fair value through profit or loss (debt instruments)
Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss on a debt investment that is subsequently measured
at FVPL is recognised in profit or loss and presented net within other gains/(losses) in the period in which it arises.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 82
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
E1 Financial Risk Management (continued)
Accounting policy - Financial assets and liabilities (continued)
(iv) Financial assets designated at fair value through OCI (equity instruments)
The Group subsequently measures all equity investments at fair value. Where the Group’s management has elected to present fair value gains and losses
on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the
investment. Dividends from such investments continue to be recognised in profit or loss as other income when the Group’s right to receive payments is
established.
Changes in the fair value of financial assets at FVPL are recognised in other gains/(losses) in profit or loss, as applicable. Impairment losses (and reversal
of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.
Derecognition
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has
transferred substantially all the risks and rewards of ownership.
Impairment
The Group assesses on a forward looking basis the expected credit losses associated with its debt instruments carried at amortised cost and FVOCI. The
impairment methodology applied depends on whether there has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected lifetime losses to be recognised from initial
recognition of the receivables. Refer to note E1(b) for more information.
Accounting policy - Derivatives
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at the
end of each reporting period. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging
instrument, and if so, the nature of the item being hedged. The Group designates certain derivatives as either:
• hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedges); or
• hedges of the cash flows or recognised assets or liabilities and highly probable forecast transactions (cash flow hedges).
The Group documents at the inception of the hedging transaction the economic relationship between hedging instruments and hedged items, as well as its
risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessments, both at hedge inception
and on an ongoing basis, of whether changes in the cash flows of the hedging instruments are expected to offset changes in the cash flows of hedged
items.
The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than 12
months. It is classified as a current asset or liability when the remaining maturity of the hedged item is less than 12 months.
(i) Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the consolidated income statement, together
with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The gain or loss relating to the effective portion of
interest rate swaps hedging fixed rate borrowings is recognised in profit or loss within finance costs, together with changes in the fair value of the hedged
fixed rate borrowings attributable to interest rate risk. The gain or loss relating to the ineffective portion is recognised in profit or loss.
If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest
method is used is amortised to profit or loss over the period to maturity using a recalculated effective interest rate.
(ii) Cash flow hedge
The Group uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising from operational and financing
activities.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in equity in the hedging
reserve. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss.
When forward contracts are used to hedge forecast transactions, the Group designates the full change in fair value of the forward contract (including forward
points) as the hedging instrument. Gains or losses relating to the effective portion of the change in the fair value of the entire forward contracts are
recognised in the cash flow hedge reserve within equity.
Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss. When the forecast transaction that
is hedged results in the recognition of a non-financial asset (for example, inventory or fixed assets) the gains and losses previously deferred in equity are
transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in profit or loss as
cost of goods sold in the case of inventory, or as depreciation in the case of fixed assets.
The gain or loss relating to the effective portion of the interest rate swaps hedging variable rate borrowings is recognised in profit or loss within finance costs
at the same time as the interest expense on the hedged borrowings.
When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss
existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast
transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately reclassified to profit or loss.
(iii) Derivatives that do not qualify for hedge accounting
Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of any derivative instrument that does not qualify for hedge
accounting are recognised immediately in profit or loss.
Myer Annual Report 2022Financial Statements 83
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
F. Equity
This section provides additional information regarding lines in the financial statements that are most relevant to explaining the equity position of the Group at
the end of the period, including the dividends declared and/or paid during the period.
F1 Contibuted Equity
Ordinary shares - fully paid
Treasury shares
Opening balance
Shares acquired by Myer Equity Plans Trust on market at $0.61
Shares acquired by Myer Equity Plans Trust on market at $0.21
Shares issued for alignment rights granted
Shares acquired by Myer Equity Plans Trust on market at $0.52
Closing balance of treasury shares
Closing balance
2022
Number of
shares
2021
Number of
shares
821,278,815 821,278,815
(2,987,987) (1,376,662)
- (931,893)
- (679,432)
2,987,987 -
(1,147,053) -
(1,147,053) (2,987,987)
820,131,762 818,290,828
2022
$m
780.0
(42.3)
-
-
-
(0.6)
(42.9)
737.1
2021
$m
780.0
(41.9)
(0.2)
(0.2)
-
-
(42.3)
737.7
Ordinary shares
The ordinary shares issued are fully paid. Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in
proportion to the number of and amounts paid on the shares held. On a show of hands, every holder of ordinary shares present at a meeting in person, or by
proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.
Treasury shares
Treasury shares are shares in Myer Holdings Limited that are held by the Myer Equity Plans Trust for the purposes of issuing shares under the Equity
Incentive Plans. Refer to note H4 for more information.
Employee share schemes
Information relating to the employee share-based payment schemes, including details of shares issued under the schemes, is set out in note H4.
Capital risk management
The Group’s key objective when managing capital is to minimise its weighted average cost of capital while maintaining appropriate financing facilities. This
provides the opportunity to pursue growth and capital management initiatives. In managing its capital structure, the Group also seeks to safeguard its ability
to continue as a going concern in order to provide appropriate returns to shareholders and benefits for other stakeholders.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue
new shares or sell assets to reduce debt.
Consistent with others in the industry, the Group monitors capital on the basis of various balance sheet ratios including the gearing ratio. This ratio is
calculated as net debt/(cash) divided by total capital. Net debt/(cash) is calculated as total borrowings less cash and cash equivalents. Total capital is
calculated as equity as shown in the balance sheet plus net debt/(cash).
The gearing ratios at 30 July 2022 and 31 July 2021 were as follows:
Borrowings (note D3)
Less: cash and cash equivalents (note D1)
Net cash at end of period (excluding lease liabilities)
Plus: lease liabilities
Net debt at end of period
Total equity
Total capital (excluding lease liabilities)
Total capital
Gearing ratio (excluding lease liabilities)
Gearing ratio
Accounting policy
Ordinary shares are classified as equity.
2022
$m
58.0
(243.9)
(185.9)
1,699.2
1,513.3
267.4
81.5
1,780.7
-228.2%
85.0%
2021
$m
66.8
(178.6)
(111.8)
1,735.5
1,623.7
226.9
115.1
1,850.6
-97.2%
87.7%
Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.
Where any Group company purchases the Company's equity instruments; for example, as the result of a share buy-back or a share-based payment plan,
the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the owners of Myer
Holdings Limited as treasury shares until the shares are cancelled or reissued. Where such ordinary shares are subsequently reissued, any consideration
received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the owners of
Myer Holdings Limited.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report
84
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
F2 Accumulated Losses and Reserves
(a) Accumulated losses
Movements in Accumulated losses were as follows:
Balance at beginning of period
Profit for the period
Dividends paid
Balance at end of period
(b) Reserves
Share-based payments 1
Cash flow hedges 2
Other reserve 3
Foreign currency translation 4
Movements in reserves were as follows:
Share-based payments
Balance at beginning of period
Share-based payments expense recognised (note H4)
Income tax (note A4)
Balance at end of period
Cash flow hedges
Balance at beginning of period
Net gain on revaluation
Transfer to net profit
Balance at end of period
Foreign currency translation
Balance at beginning of period
Exchange differences on translation of foreign operations during the period
Balance at end of period
2022
$m
2021
$m
(514.0)
49.0
(12.3)
(477.3)
32.0
4.0
(25.6)
(2.8)
7.6
29.3
3.9
(1.2)
32.0
3.2
2.3
(1.5)
4.0
(3.7)
0.9
(2.8)
(560.4)
46.4
-
(514.0)
29.3
3.2
(25.6)
(3.7)
3.2
27.5
2.3
(0.5)
29.3
(2.7)
6.1
(0.2)
3.2
(4.3)
0.6
(3.7)
1. Share-based payments
The share-based payments reserve is used to recognise the fair value of options and rights granted to employees under the employee share plans. Further
information on share-based payments is set out in note H4.
2. Cash flow hedges
The hedging reserve is used to record gains or losses on a hedging instrument in a cash flow hedge that are recognised directly in equity, as described in
note E1. Amounts are recognised in the consolidated income statement when the associated hedged transaction affects profit or loss.
3. Other reserve
The Group acquired 65% of the sass & bide business in 2011, and the non-controlling shareholders held a put option over the remaining 35%. This resulted
in the Group recognising a financial liability for the put option and a corresponding amount in other reserve. In 2014, upon acquisition of the remaining 35%
of sass & bide, the cash payment of $33.4m was recorded against the financial liability and non-controlling interests balances were recorded against other
reserve.
4. Foreign currency translation
Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive income and accumulated in a separate
reserve within equity. The cumulative amount is reclassified to the consolidated income statement when the net investment is disposed of.
Myer Annual Report 2022Financial Statements 85
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
F2 Accumulated Losses and Reserves (continued)
Accounting policy
(i) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial statements are presented in Australian dollars, which is Myer Holdings Limited’s
functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions and from the translation at end of period exchange rates of monetary assets
and liabilities denominated in foreign currencies are generally recognised in profit or loss. They are deferred in equity if they relate to qualifying cash flow
hedges.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was
determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation
differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair
value gain or loss and translation differences on non-monetary assets such as equities classified as available-for-sale financial assets are recognised in
other comprehensive income.
(iii) Group companies
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy) that have a functional currency
different from the presentation currency are translated into the presentation currency as follows:
• assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;
• income and expenses for each consolidated income statement and statement of comprehensive income are translated at the rates prevailing on
the transaction dates; and
• all resulting exchange differences are recognised in other comprehensive income.
On consolidation, when a foreign operation is sold, the associated exchange difference is reclassified to profit or loss, as part of the gain or loss on sale.
F3 Dividends
(a) Ordinary
Interim fully franked dividend for the period ended 30 July 2022 of 1.5 cents (2021: nil) per fully paid ordinary share, paid
12 May 2022
Total dividends paid
(b) Dividends not recognised at the end of the reporting period
The directors have determined the payment of a final dividend of 2.5 cents (2021: nil) per fully paid ordinary share fully
franked based on tax paid at 30%, payable on 7 November 2022
The aggregate amount of the proposed dividend expected to be paid after period end, but not recognised as a liability at
period end, is:
2022
$m
12.3
12.3
20.5
2021
$m
-
-
-
(c) Franked dividends
The franked portions of final dividends recommended after 30 July 2022 will be franked out of existing franking credits or
out of franking credits arising from the payment of income tax in the period ended 29 July 2023:
Franking credits available for subsequent reporting periods based on a tax rate of 30% (2021: 30%)
85.5
67.0
The above amounts are calculated from the balance of the franking account as at the end of the reporting period, adjusted for franking credits and debits
that will arise from the settlement of liabilities or receivables for income tax and dividends after the end of the reporting period.
The consolidated amounts include franking credits that would be available to the parent entity if distributable profits of subsidiaries were paid as dividends.
Accounting policy
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end
of the financial period but not distributed at balance date.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 86
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
G. Group Structure
This section summarises how the Group structure affects the financial position and performance of the Group as a whole.
G1 Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy
described below:
Name of entity
NB Elizabeth Pty Ltd
NB Russell Pty Ltd
NB Lonsdale Pty Ltd
NB Collins Pty Ltd
Warehouse Solutions Pty Ltd
Myer Group Pty Ltd
Myer Pty Ltd
Myer Group Finance Limited
The Myer Emporium Pty Ltd
ACT Employment Services Pty Ltd
Myer Employee Share Plan Pty Ltd
Myer Travel Pty Ltd
Myer Sourcing Asia Ltd
Shanghai Myer Service Company Ltd
Boogie & Boogie Pty Ltd
sass & bide Pty Ltd
sass & bide Retail Pty Ltd
sass & bide Retail (NZ) Pty Ltd
sass & bide USA inc.
sass & bide inc.
Marcs David Lawrence Pty Ltd
Notes
(1), (3)
(2), (3)
(2), (3)
(1), (3)
(2), (3)
(1), (3)
(1), (3)
(1), (3)
(2), (3)
(2)
(2)
(2)
(2), (3)
(2), (3)
(2), (3)
(2), (3)
(1), (3)
Country of
incorporation
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Hong Kong
China
Australia
Australia
Australia
Australia
USA
USA
Australia
Class of shares
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Equity
holdings(4)
2022
%
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Equity
holdings(4)
2021
%
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
(1) Each of these entities have been granted relief from the necessity to prepare financial statements in accordance with ASIC Corporations (Wholly-
owned Companies) Instrument 2016/785.
(2) Each of these entities is classified as small proprietary and therefore relieved from the requirement to prepare and lodge financial reports with ASIC.
(3) Each of these entities is party to a deed of cross guarantee, refer to note G2.
(4) The proportion of ownership interest is equal to the proportion of voting power held.
Accounting policy
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Myer Holdings Limited ('Company' or 'parent entity') as at 30
July 2022 and the results of all subsidiaries for the period then ended.
Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or
has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the
entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control
ceases. The acquisition method of accounting is used to account for business combinations by the Group (refer to note C2).
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to
ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated income statement, statement of comprehensive
income, balance sheet and statement of changes in equity respectively.
Employee Share Trust
The Group has the Myer Equity Plans Trust to administer the Group's employee share scheme. This trust is consolidated, as the substance of the
relationship is that the trust is controlled by the Group. Shares in Myer Holdings Limited held by the trust are disclosed as treasury shares and deducted
from contributed equity.
Myer Annual Report 2022Financial Statements 87
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
G2 Deed of Cross Guarantee
The following entities are parties to a deed of cross guarantee under which each company guarantees the debts of the others:
• Myer Holdings Limited
• NB Elizabeth Pty Ltd
• NB Russell Pty Ltd
• Myer Group Pty Ltd
• NB Lonsdale Pty Ltd
• NB Collins Pty Ltd
• Warehouse Solutions Pty Ltd
• Myer Pty Ltd
• Myer Group Finance Limited
• The Myer Emporium Pty Ltd
• Boogie & Boogie Pty Ltd
• sass & bide Pty Ltd
• sass & bide Retail Pty Ltd
• sass & bide Retail (NZ) Pty Ltd
• Marcs David Lawrence Pty Ltd
By entering into the deed, the wholly-owned entities within note reference 1 in note G1 have been relieved from the requirements to prepare a financial
report and directors' report under ASIC Corporations (Wholly-owned Companies) Instrument 2016/785.
The above companies represent a 'closed group' for the purposes of the ASIC Legislative Instrument, and as there are no other parties to the deed of cross
guarantee that are controlled by Myer Holdings Limited, they also represent the 'extended closed group'.
(a) Consolidated income statement, statement of comprehensive income and summary of movements in consolidated accumulated losses
Set out below is a consolidated income statement, statement of comprehensive income and a summary of movements in consolidated accumulated losses
for the closed group for the period ended 30 July 2022:
Income statement
Total sales
Concession sales
Sale of goods
Sales revenue deferred under customer loyalty program
Revenue from sale of goods
Other operating revenue
Cost of goods sold
Operating gross profit
Other income
Selling expenses
Administration expenses
Restructuring, space exit costs and impairment of assets
Earnings before interest and tax
Finance revenue
Finance costs
Net finance costs
Profit before income tax
Income tax expense
Profit for the period attributable to Deed of Cross Guarantee group
Statement of comprehensive income
Profit for the period
Other comprehensive income
Items that may be reclassified to profit or loss:
Cash flow hedges
Exchange differences on translation of foreign operations
Other comprehensive income for the period, net of tax
Total comprehensive income for the period
Summary of movements in accumulated losses
Balance at beginning of period
Profit for the period
Dividends paid
Balance at end of period
2022
52 weeks
$m
2021
53 weeks
$m
2,989.8
(606.2)
2,383.6
(43.0)
2,340.6
161.4
(1,356.7)
1,145.3
0.9
(690.9)
(271.0)
(13.2)
171.1
0.3
(99.2)
(98.9)
72.2
(23.1)
49.1
49.1
0.8
0.7
1.5
50.6
(510.5)
49.1
(12.3)
(473.7)
2,658.3
(505.5)
2,152.8
(36.3)
2,116.5
133.6
(1,194.6)
1,055.5
2.4
(648.3)
(239.3)
(7.6)
162.7
0.3
(96.4)
(96.1)
66.6
(20.2)
46.4
46.4
5.9
0.5
6.4
52.8
(556.9)
46.4
-
(510.5)
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report
88
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
G2 Deed of Cross Guarantee (continued)
(b) Consolidated balance sheet
Set out below is a consolidated balance sheet as at 30 July 2022 of the closed group:
Assets
Current assets
Cash and cash equivalents
Trade and other receivables and prepayments
Inventories
Derivative financial instruments
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Deferred tax assets
Derivative financial instruments
Other non-current assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Derivative financial instruments
Current tax liabilities
Other liabilities
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Accumulated losses
Reserves
Total equity
2022
$m
240.8
36.1
371.3
5.3
653.5
304.8
1,177.6
305.3
111.4
0.3
3.2
1,902.6
2,556.1
429.7
144.0
67.7
0.6
23.8
0.1
665.9
58.0
1,554.9
4.3
1,617.2
2,283.1
273.0
737.1
(473.7)
9.6
273.0
2021
$m
176.2
28.1
304.0
3.1
511.4
318.3
1,223.7
304.4
112.2
0.7
2.7
1,962.0
2,473.4
352.9
156.0
63.1
1.1
16.4
0.2
589.7
66.8
1,579.1
4.8
1,650.7
2,240.4
233.0
737.7
(510.5)
5.8
233.0
Myer Annual Report 2022Financial Statements NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
G3 Parent Entity Financial Information
(a) Summary financial information
The individual financial statements for the parent entity show the following aggregate amounts:
Balance sheet
Current assets
Total assets
Current liabilities
Total liabilities
Shareholders' equity
Issued capital
Reserves
Other reserves
Share-based payments
Retained profits reserve - pre 2018
Accumulated losses reserve - 2018
Retained profits reserve - 2019
Accumulated losses reserve - 2020
Retained profits reserve - 2022
Profit for the period
Total comprehensive income for the period
(b) Guarantees entered into by the parent entity
Carrying amount included in current liabilities
89
2022
$m
235.7
435.6
45.8
103.8
737.1
(2.7)
27.9
66.6
(406.7)
6.0
(170.6)
74.2
74.2
74.2
2021
$m
171.6
370.7
37.4
104.2
737.7
(2.7)
23.9
78.9
(406.7)
6.0
(170.6)
-
-
-
-
-
The parent entity is the borrowing entity under the Group's financing facilities. Under these facilities, the parent entity is party to a cross-guarantee with
various other Group entities, who guarantee the repayment of the facilities in the event that the parent entity is in default.
The parent entity is also party to the deed of cross guarantee. The details of the deed of cross guarantee are set out in note G2. At the end of the reporting
period, no liability has been recognised in relation to these guarantees on the basis that the potential exposure is not considered material.
(c) Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities as at 30 July 2022 or 31 July 2021.
(d) Contractual commitments for the acquisition of property, plant or equipment
The parent entity did not have any contractual commitments for the acquisition of property, plant or equipment as at 30 July 2022 or 31 July 2021.
(e) Event subsequent to balance date
Refer to note H6 for additional events which have occurred after the financial reporting date.
Accounting policy
The financial information that is disclosed for the parent entity, Myer Holdings Limited, has been prepared on the same basis as the consolidated financial
statements, except as set out below.
(i) Investments in subsidiaries
Investments in subsidiaries are accounted for at cost in the financial statements of Myer Holdings Limited.
(ii) Tax consolidation legislation
Myer Holdings Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation legislation.
The head entity, Myer Holdings Limited, and the controlled entities in the tax consolidated group continue to account for their own current and deferred tax
amounts. These tax amounts are measured as if each entity in the tax consolidated group continues to be a stand-alone taxpayer in its own right.
In addition to its own current and deferred tax amounts, Myer Holdings Limited also recognises the current tax liabilities (or assets) and the deferred tax
assets arising from unused tax losses and unused tax credits assumed from controlled entities in the tax consolidated group.
The entities have also entered into a tax funding agreement under which the wholly-owned entities fully compensate Myer Holdings Limited for any current
tax payable assumed and are compensated by Myer Holdings Limited for any current tax receivable and deferred tax assets relating to unused tax losses or
unused tax credits that are transferred to Myer Holdings Limited under the tax consolidation legislation. The funding amounts are determined by reference to
the amounts recognised in the wholly-owned entities’ financial statements.
The funding amounts are recognised as current intercompany receivables or payables.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts receivable from or payable to other
entities in the Group.
Any difference between the amounts assumed and amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or
distribution from) wholly-owned tax consolidated entities.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 90
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
H. Other Financial Information
This section of the notes includes other financial information that must be disclosed to comply with the accounting standards and other pronouncements, but
that is not immediately related to individual line items in the financial statements. This section also provides information about items that are not recognised
in the financial statements as they do not (yet) satisfy the recognition criteria.
H1 Contingencies
Contingent liabilities
The Group had contingent liabilities at 30 July 2022 in respect of:
Guarantees
The Group has issued bank guarantees amounting to $32.3 million (2021: $33.2 million), of which $14.1 million (2021: $16.5 million) represents guarantees
supporting workers' compensation self insurance licences in various jurisdictions. For information about other guarantees given by entities within the Group,
including the parent entity, refer to notes G2 and G3.
There can be legal claims and exposures which arise from the ordinary course of business. There is significant uncertainty as to whether a future liability will
arise in respect of these items, or the amount of any such liability.
H2 Commitments
Capital commitments
Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows:
Property, plant, equipment and software
Payable:
Within one year
Later than one year but not later than five years
Later than five years
2022
$m
26.7
-
-
26.7
2021
$m
15.9
-
-
15.9
H3 Related Party Transactions
(a) Parent entities
The parent entity within the Group is Myer Holdings Limited, a listed public company, incorporated in Australia.
(b) Subsidiaries
Interests in subsidiaries are set out in note G1.
(c) Key Management Personnel
(i) Compensation
Key Management Personnel compensation for the period ended 30 July 2022 is set out below. The Key Management Personnel of the Group are persons
having the authority for planning, directing and controlling the Company's activities directly or indirectly, including the directors of Myer Holdings Limited.
Short-term employee benefits
Post employment benefits
Long-term benefits
Share-based payments
2022
$
4,750,055
102,506
2,077
2,278,990
7,133,628
2021
$
4,999,650
87,051
73,466
1,422,374
6,582,541
Detailed remuneration disclosures are provided in the Remuneration Report on pages 30 to 56.
(ii) Loans
In 2022 and 2021 there were no loans made to directors of Myer Holdings Limited and other Key Management Personnel of the Group, including their
related parties.
(iii) Other transactions
The transactions with Key Management Personnel or entities related to them are as disclosed in the Remuneration Report.
(d) Transactions with other related parties
There were no material transactions with other related parties during the current period.
Myer Annual Report 2022Financial Statements 91
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
H4 Share-Based Payments
(a) Long Term Incentive Plan
The Myer Long Term Incentive Plan (LTIP) is an incentive that is intended to promote alignment between executive and shareholder interests over the
longer term. Under the LTIP, performance rights and options may be offered annually to the Chief Executive Officer and nominated executives. The
employees invited to participate in the plan include executives who are considered to play a leading role in achieving the Group’s long term strategic and
operational objectives.
Each right and option offered is an entitlement to one fully paid ordinary share in the Company, subject to adjustment for capital actions, on terms and
hurdles determined by the Board, including hurdles linked to Company performance and service. Performance rights and options vest and are automatically
exercised on a net settlement basis.
The LTIP is delivered via a grant of performance rights or options. The number of performance rights or options that vest is not determined until after the
end of the performance period. The performance right or option will therefore not provide any value to the holder between the date the performance right or
option is granted until after the end of the vesting period, if the performance hurdles and restriction period (if applicable) are satisfied. Performance rights
and options do not carry entitlements to ordinary dividends or other shareholder rights until the end of the vesting period.
Set out below is a summary of performance rights and options granted under the plan:
2022
Performance rights
Performance options
Total
Weighted average exercise price
2021
Performance rights
Performance options
Total
Weighted average exercise price
Granted
Balance
31 July 2021
Exercised
17,128,531 6,514,842 (2,987,987)
54,303,324 - - (30,046,033)
71,431,855 6,514,842 (2,987,987) (30,046,033)
$0.42
Expired and
lapsed
Balance
30 July 2022
- 20,655,386
24,257,291
44,912,677
$0.30
$0.00
$0.00
$0.36
Balance
25 July 2020
Expired and
lapsed
7,049,241 14,140,544 - (4,061,254)
57,444,948 - - (3,141,624)
64,494,189 14,140,544 - (7,202,878)
$0.21
Exercised
Granted
$0.00
$0.00
$0.43
Balance
31 July 2021
17,128,531
54,303,324
71,431,855
$0.36
The weighted average remaining contractual life of share rights and options outstanding at the end of the period was 1.0 year (2021: 1.0 year).
Fair value of performance rights granted
The assessed fair value at grant date of rights granted during the period is noted below. Fair value varies depending on the period to vesting date. The fair
values at grant dates were independently determined using a Monte Carlo simulation pricing model that takes into account the exercise price, the term of
the rights, the impact of dilution, the fair value of shares in the Company at grant date and expected volatility of the underlying share, the expected dividend
yield and the risk-free interest rate for the term of the right. The fair values and model inputs for performance rights granted during the period included:
(a) Fair value of performance rights granted
(b) Grant date
(c) Expiry date
(d) Share price at grant date
(e) Expected price volatility of the Group’s shares
(f) Expected dividend yield
(g) Risk-free interest rate
2022 LTIP
Rights (TSR)
$0.38
10-Nov-21
10-Nov-25
$0.52
73%
0%
1.24%
2022 LTIP
Rights (EPS)
$0.40
10-Nov-21
10-Nov-25
$0.52
73%
0%
1.24%
The expected price volatility is based on the historic volatility (based on the remaining life of the performance options), adjusted for any expected changes to
future volatility due to publicly available information.
Where rights are issued to employees of subsidiaries within the Group, the subsidiaries compensate the Company for the amount recognised as an
expense in relation to these rights.
(b) Transformation Incentive (TI) Plan
The Transformation Incentive (TI) Plan was introduced to replace the normal STI plan for a period of two years, starting in FY21. Under the TI plan, the Chief
Executive Officer and nominated executives receive 50% of the annual TI achieved in cash and 50% in equity.
FY21 TI Plan
The FY21 TI plan delivered the equity component via deferred rights, 50% subject to a one-year deferral period and 50% subject to a two-year deferral
period. On vesting following the end of the deferral periods, the rights automatically convert into ordinary shares on a one for one basis at an exercise price
of nil. There is no entitlement to receive dividends nor any voting rights in relation to the deferred rights during the vesting period. If an executive ceases to
be employed by the Group within this period, the rights will be forfeited, except in circumstances that are approved by the board on a case-by-case basis.
During the period 2,294,105 deferred rights were issued based on the currency value of the achieved FY21 TI award divided by the volume weighted
average price of the Company’s shares over the five trading days immediately following the release to the market of the company's full year FY21 results.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 92
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
H4 Share-Based Payments (continued)
(b) Transformation Incentive (TI) Plan (continued)
FY22 TI Plan
The FY22 TI plan delivered the equity component via rights to deferred shares, 50% subject to a one-year disposal restriction and 50% subject to a two-year
disposal restriction. The number of deferred shares to be issued will be determined by dividing the dollar value of the right to deferred shares component of
the TI plan award by the volume weighted average price of the Company’s shares over the five trading days immediately following the release to the market
of the Company’s full year FY22 results.
The shares will carry rights to dividends and voting rights and will rank equally in all respects with other ordinary shares already on issue on the date of
allocaton, except for entitlements which had a record date before the date of allocation.
(c) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period as part of employee benefit expense were as follows:
Rights and options issued under the LTIP
Rights issued under the TIP
2022
$m
3.1
0.8
2021
$m
1.8
0.5
Share-based payment transaction expenses represent the amount recognised in the period in relation to share-based remuneration plans. Where
expectations of the number of rights or options expected to vest changes, the life to date expense is adjusted, which can result in a negative expense for the
period due to the reversal of amounts recognised in prior periods.
Accounting policy
Share-based compensation benefits are provided to employees through the Myer Long Term Incentive Plan (LTIP) and Transformation Incentive Plan (TIP).
The fair value of rights and options granted under a plan are recognised as an employee benefit expense with a corresponding increase in equity. The total
amount to be expensed is determined by reference to the fair value of the rights and options granted, which includes any market performance conditions but
excludes the impact of any services and non-market performance vesting conditions and the impact of any non-vesting conditions.
Non-market vesting conditions are included in assumptions about the number of rights and options that are expected to vest. The total expense is
recognised over the vesting period, which is the period over which all the specified vesting conditions are to be satisfied. At the end of each period, the
Group revises its estimates of the number of rights or options that are expected to vest based on the non-market vesting conditions. It recognises the impact
of revisions to original estimates, if any, in profit or loss, with a corresponding adjustment to equity.
The LTIP and TIP are administered by the Myer Equity Plan Trust (refer to note G1). When rights or options are vested, the trust transfers the appropriate
number of shares to the employee. The proceeds received net of any directly attributable transaction costs are credited directly to equity.
H5 Remuneration of Auditors
During the period, the following fees were paid or payable for services provided by the auditor of the Group, and its related practices:
(a) PwC Australia
(i) Assurance services
Audit services
Audit and review of financial statements
Other assurance services
Audit of rent certificates
Total remuneration for audit and other assurance services
(ii) Taxation services
Tax compliance services
Total remuneration of PwC Australia
(b) Overseas practices of PwC
(i) Assurance services
Audit services
Audit and review of financial statements
Total remuneration for overseas practices of PwC
H6 Events Occurring After the Reporting Period
2022
$
2021
$
498,260
561,000
40,769
539,029
3,000
542,029
29,283
590,283
3,000
593,283
71,796
71,796
66,452
66,452
Store Closure
On 23 August 2022, Myer announced that it will be exiting its store located at Frankston, Victoria. The store is anticipated to cease trading on 15 January
2023. An estimate of the financial effect has been recognised in the financial statements for the period ended 30 July 2022.
Dividends on the Company's ordinary shares
The directors have determined to pay a final dividend of 2.5 cents per share, fully franked at the 30% corporate income tax rate, payable on 7 November
2022 for the period ended 30 July 2022.
Myer Annual Report 2022Financial Statements 93
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 July 2022
I. Other Accounting Policies
This section provides a list of other accounting policies adopted in the preparation of these consolidated financial statements. Specific accounting policies
are disclosed in their respective notes to the financial statements. This section also provides information on the impacts of new accounting standards,
amendments and interpretations, and whether they are effective in the current or future reporting periods.
The principal accounting policies adopted in the preparation of these consolidated financial statements ('financial statements' or 'financial report') are set out
below. These policies have been consistently applied to all the periods presented, unless otherwise stated. The financial statements are for the consolidated
entity consisting of Myer Holdings Limited and its subsidiaries ('Group').
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (AASB) and the Corporations Act 2001. Myer Holdings Limited is a for-profit entity for the purpose of preparing the
financial statements.
Compliance with IFRS
The consolidated financial statements of Myer Holdings Limited group also comply with International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB).
Historical cost convention
These financial statements have been prepared under the historical cost convention, except for financial assets and liabilities (including derivative
instruments), which have been measured at fair value through profit or loss.
Working capital position
As at 30 July 2022, the Group has a net current liability position of $16.7 million, which includes cash and cash equivalents of $243.9 million. The net current
liability includes the recognition of current lease liabilities of $144.2 million from the adoption of AASB 16 Leases . The Group has available borrowing facility
of $44.9 million, which will enable the Group to pay its debts as and when they become due and payable.
(b) Rounding of amounts
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191 and, except where otherwise
stated, amounts in the consolidated financial statements have been rounded off to the nearest hundred thousand dollars.
(c) New accounting standards and interpretations
New and amended standards adopted by the Group
The Group note that none of the new standards or amendments to existing standards that are mandatory for the first time for the 30 July 2022 reporting
period materially affect any of the amounts recognised in the current period or prior period, and are not likely to significantly affect future periods.
Myer Annual Report 2022Financial StatementsDirectors’ Report Financial StatementsYear in Review Remuneration Report 94
Directors’
Declaration
DIRECTORS’ DECLARATION
In the directors’ opinion:
(a) the financial statements and notes set out on pages 58 to 93 are in accordance with the Corporations Act 2001 (Cth),
including:
(i)
(ii)
complying with Accounting Standards, the Corporations Regulations 2001 (Cth) and other mandatory
professional reporting requirements; and
giving a true and fair view of the consolidated entity’s financial position as at 30 July 2022 and of its
performance for the financial period ended on that date; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
Report on the audit of the financial report
and payable; and
(c) at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed
group will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of the deed
of cross guarantee described in note G2.
Note I. (a) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
The directors have been given the declarations by the Chief Executive Officer and the Chief Financial Officer required by section
295A of the Corporations Act 2001 (Cth).
This declaration is made in accordance with a resolution of the directors.
JoAnne Stephenson
Chairman
Melbourne, 15 September 2022
Independent auditor’s report
To the members of Myer Holdings Limited
Our opinion
In our opinion:
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
performance for the period 1 August 2021 to 30 July 2022
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
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and other explanatory information
the directors’ declaration.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
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Myer Annual Report 2022 95
Independent auditor’s report
Independent auditor’s report
To the members of Myer Holdings Limited
To the members of Myer Holdings Limited
Report on the audit of the financial report
Report on the audit of the financial report
Our opinion
Our opinion
In our opinion:
In our opinion:
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
performance for the period 1 August 2021 to 30 July 2022
performance for the period 1 August 2021 to 30 July 2022
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
What we have audited
The Group financial report comprises:
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the consolidated balance sheet as at 30 July 2022
the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
and other explanatory information
the directors’ declaration.
the directors’ declaration.
●
Basis for opinion
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
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Myer Annual Report 2022Directors’ Report Year in Review Remuneration ReportFinancial Statements 96
Our audit approach
Independent auditor’s report
Key audit matters
To the members of Myer Holdings Limited
An audit is designed to provide reasonable assurance about whether the financial report is free from
material misstatement. Misstatements may arise due to fraud or error. They are considered material if
individually or in aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of the financial report.
Report on the audit of the financial report
Our opinion
We tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the financial report as a whole, taking into account the geographic and management
structure of the Group, its accounting processes and controls and the industry in which it operates.
In our opinion:
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
performance for the period 1 August 2021 to 30 July 2022
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
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Materiality
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the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
the directors’ declaration.
● For the purpose of our audit we used overall Group materiality of $3.6 million, which represents
●
approximately 5% of the Group’s profit before tax.
Basis for opinion
● We applied this threshold, together with qualitative considerations, to determine the scope of our audit and
the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements on the
financial report as a whole.
● We chose Group profit before tax because, in our view, it is the benchmark against which the performance
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
of the Group is most commonly measured.
● We utilised a 5% threshold based on our professional judgement, noting it is within the range of commonly
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
acceptable thresholds.
for our opinion.
Audit Scope
● Our audit focused on where the Group made subjective judgements; for example, significant accounting
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
● The Group is principally involved in retailing through department stores across Australia and online. The
accounting processes are structured around the Group's finance function at its Melbourne support office.
estimates involving assumptions and inherently uncertain future events.
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Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. The key audit matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters. Further, any commentary on the outcomes of a
particular audit procedure is made in that context. We communicated the key audit matters to the
Audit, Finance and Risk Committee.
Key audit matter
How our audit addressed the key audit matter
Carrying value of non-current assets
(Refer to notes C1, C2 and C4)
Our audit procedures included, amongst others:
The Group’s non-financial assets include, amongst
into CGUs was consistent with our knowledge of the
others, intangible assets with indefinite lives,
Group’s operations and internal Group reporting
• evaluated whether the allocation of the Group’s assets
representing brand names and trademarks, property,
plant and equipment, software and right-of-use
assets.
• evaluated the appropriateness of the Group’s method
for developing the estimate of the recoverable amount
The Group assessed there were no indicators of
• performed testing over the mathematical accuracy of a
impairment for individual stores.
selection of key data in the model.
At least annually, an impairment assessment is
• compared the Group’s forecast cash flows to Board
performed by the Group over the cash generating unit
approved budgets
which has the trademark with an indefinite life.
The Group performed an impairment assessment by
assumptions used in the model, including forecast
preparing a value-in-use model to determine if the
EBITDA margins, discount rates and terminal growth
• evaluated the appropriateness of significant
carrying value of the assets in the Myer Group cash
rates
generating unit was supported by forecast future cash
flows, discounted to present value (the "model").
Given the financial significance of non-financial
results for the past three years
assets and the significant judgements and
assumptions applied by the Group in estimating
future cash flows, we considered this to be a key
audit matter.
• assessed the Group’s historical ability to forecast cash
flows by comparing the forecast cash flows to actual
• together with PwC valuation experts, evaluated the
appropriateness of the discount rates used in the model
by comparing them to market data and comparable
companies.
• evaluated the Group’s assessment of whether there
were any indicators of impairment for individual stores.
We assessed the reasonableness of the Group's
disclosures in the financial report against the
requirements of the Australian Accounting Standards.
Myer Annual Report 2022 97
Key audit matters
Independent auditor’s report
To the members of Myer Holdings Limited
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. The key audit matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters. Further, any commentary on the outcomes of a
particular audit procedure is made in that context. We communicated the key audit matters to the
Audit, Finance and Risk Committee.
Our opinion
Report on the audit of the financial report
Key audit matter
In our opinion:
How our audit addressed the key audit matter
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
Our audit procedures included, amongst others:
Carrying value of non-current assets
(Refer to notes C1, C2 and C4)
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
performance for the period 1 August 2021 to 30 July 2022
• evaluated whether the allocation of the Group’s assets
into CGUs was consistent with our knowledge of the
Group’s operations and internal Group reporting
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
The Group’s non-financial assets include, amongst
others, intangible assets with indefinite lives,
representing brand names and trademarks, property,
plant and equipment, software and right-of-use
What we have audited
assets.
The Group financial report comprises:
• evaluated the appropriateness of the Group’s method
for developing the estimate of the recoverable amount
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The Group assessed there were no indicators of
impairment for individual stores.
At least annually, an impairment assessment is
performed by the Group over the cash generating unit
which has the trademark with an indefinite life.
• performed testing over the mathematical accuracy of a
selection of key data in the model.
the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
the directors’ declaration.
• evaluated the appropriateness of significant
assumptions used in the model, including forecast
EBITDA margins, discount rates and terminal growth
rates
• compared the Group’s forecast cash flows to Board
approved budgets
The Group performed an impairment assessment by
preparing a value-in-use model to determine if the
carrying value of the assets in the Myer Group cash
generating unit was supported by forecast future cash
flows, discounted to present value (the "model").
Basis for opinion
●
• assessed the Group’s historical ability to forecast cash
flows by comparing the forecast cash flows to actual
results for the past three years
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Given the financial significance of non-financial
those standards are further described in the Auditor’s responsibilities for the audit of the financial
assets and the significant judgements and
report section of our report.
assumptions applied by the Group in estimating
future cash flows, we considered this to be a key
audit matter.
• together with PwC valuation experts, evaluated the
appropriateness of the discount rates used in the model
by comparing them to market data and comparable
companies.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
We assessed the reasonableness of the Group's
disclosures in the financial report against the
requirements of the Australian Accounting Standards.
• evaluated the Group’s assessment of whether there
were any indicators of impairment for individual stores.
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Myer Annual Report 2022Directors’ Report Year in Review Remuneration ReportFinancial Statements 98
Key audit matter
Independent auditor’s report
How our audit addressed the key audit matter
To the members of Myer Holdings Limited
Inventory valuation
(Refer to note B2)
Report on the audit of the financial report
To assess the Group’s inventory provisions we
performed the following procedures, amongst others:
Our opinion
The Group held inventory of $371 million at
30 July 2022. Inventories are valued at the lower of
cost and net realisable value.
In our opinion:
• assessed the Group’s inventory provisioning policy by
considering the levels of aged inventory and the
Group’s inventory clearance strategy
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
• for a sample of inventory items, compared the current
selling price (net realisable value) to the recorded cost
The Group recognises a provision where it expects
the net realisable value of inventory to fall below its
cost price.
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
performance for the period 1 August 2021 to 30 July 2022
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
• evaluated the appropriateness of the Group’s
markdown assumptions when considered against
promotional activity after period end
We considered this a key audit matter because the
Group applies judgements and assumptions in
forecasting future selling prices to estimate the value
What we have audited
of inventory likely to sell below cost in the future.
The Group financial report comprises:
We assessed the reasonableness of the Group's
disclosures in the financial report against the
requirements of the Australian Accounting Standards.
Refinancing of the debt facility
(Refer to notes D3)
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the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
the directors’ declaration.
Read the signed agreements between the Group and its
lenders to understand the terms of the Asset Based
Loan syndicated facility agreement and the amount of
facility available for drawdown.
Obtained confirmations directly from the Group’s banks
to confirm the borrowings’ balance at 30 July 2022
The Group has bank loans of $65 million as at
30 July 2022.
The new debt funding agreement of the Group is an
Basis for opinion
Asset Based Loan (ABL) syndicated facility.
Given the debt funding agreement was a new facility
and the financial significance of the balance, we
considered it was a key audit matter.
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
Evaluated whether the debt was classified as current or
non-current at 30 July 2022 in accordance with
Australian Accounting Standards
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
We assessed the reasonableness of the Group's
disclosures in the financial report against the
requirements of the Australian Accounting Standards.
Other information
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
The directors are responsible for the other information. The other information comprises the
information included in the annual financial report for the period ended 30 July 2022, but does not
include the financial report and our auditor’s report thereon. Prior to the date of this auditor's report,
the other information we obtained included the Directors' Report. We expect the remaining other
information to be made available to us after the date of this auditor's report.
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Our opinion on the financial report does not cover the other information and we do not and will not
express an opinion or any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
When we read the other information not yet received, if we conclude that there is a material
misstatement therein, we are required to communicate the matter to the directors and use our
professional judgement to determine the appropriate action to take.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing
and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our
auditor's report.
Myer Annual Report 2022 99
Independent auditor’s report
Our opinion on the financial report does not cover the other information and we do not and will not
express an opinion or any form of assurance conclusion thereon.
To the members of Myer Holdings Limited
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
Report on the audit of the financial report
Our opinion
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
In our opinion:
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
When we read the other information not yet received, if we conclude that there is a material
misstatement therein, we are required to communicate the matter to the directors and use our
professional judgement to determine the appropriate action to take.
performance for the period 1 August 2021 to 30 July 2022
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
Responsibilities of the directors for the financial report
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
the consolidated statement of changes in equity for the period then ended
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
the consolidated statement of cash flows for the period then ended
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
the notes to the consolidated financial statements, which include significant accounting policies
operations, or have no realistic alternative but to do so.
and other explanatory information
the directors’ declaration.
Auditor’s responsibilities for the audit of the financial report
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Basis for opinion
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
A further description of our responsibilities for the audit of the financial report is located at the Auditing
and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our
auditor's report.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
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Myer Annual Report 2022Directors’ Report Year in Review Remuneration ReportFinancial Statements 100
Report on the remuneration report
Independent auditor’s report
Our opinion on the remuneration report
To the members of Myer Holdings Limited
We have audited the remuneration report included in pages 30 to 56 of the directors’ report for the
period ended 30 July 2022.
Report on the audit of the financial report
In our opinion, the remuneration report of Myer Holdings Limited for the period ended 30 July 2022
complies with section 300A of the Corporations Act 2001.
Our opinion
In our opinion:
Responsibilities
The accompanying financial report of Myer Holdings Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 July 2022 and of its financial
The directors of the Company are responsible for the preparation and presentation of the
remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the remuneration report, based on our audit conducted in accordance with
Australian Auditing Standards.
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
performance for the period 1 August 2021 to 30 July 2022
What we have audited
The Group financial report comprises:
PricewaterhouseCoopers
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the consolidated balance sheet as at 30 July 2022
the consolidated income statement for the period then ended
the consolidated statement of comprehensive income for the period then ended
the consolidated statement of changes in equity for the period then ended
the consolidated statement of cash flows for the period then ended
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
the directors’ declaration.
Melbourne
15 September 2022
Alison Tait Milner
Partner
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
81
86
Myer Annual Report 2022 101
Shareholder
information
As at 16 September 2022.
Myer has one class of shares on issue (being ordinary shares). All the Company’s shares are listed on the Australian
Securities Exchange.
Issued Capital
Number of Shareholders
Minimum Parcel Price
Holders with less than a marketable parcel
Distribution of shareholders and shareholdings
Range
100,001 and Over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Unmarketable parcels
Number
821,278,815
41,271
$0.615
18,883
Units
648,212,059
111,931,364
21,430,628
29,587,347
10,117,417
%
78.93
13.63
2.61
3.60
1.23
Holders
454
3,617
2,688
13,327
21,185
%
1.10
8.76
6.51
32.29
51.33
821,278,815
100.00
41,271
100.00
Minimum $500.00 parcel at $0.615 per unit
Twenty largest shareholders
Rank Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
METALGROVE PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
HAPPY SABA GROUP NO 1 PTY LTD
BOND STREET CUSTODIANS LIMITED
BNP PARIBAS NOMS PTY LTD
SPROUT GROUP PTY LTD
NATIONAL NOMINEES LIMITED
AM GLORY PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
ACE PROPERTY HOLDINGS PTY LTD
TSOU ENTERPRISE PTY LTD
SRH SUPER PTY LTD
MR JOHN ANTHONY KING
MR PAT O’NEILL
RIADIS HOLDINGS PTY LTD
MR RAJESH PARSOTAM HARIDAS
COMSEC NOMINEES PTY LIMITED
DR PETER MALCOLM HEYWORTH
Total
Balance of register
Grand total
Minimum
Parcel Size
813
Holders
18,883
Units
7,908,907
Units % of Units
22.87
15.40
9.40
4.34
1.27
1.24
1.12
1.01
0.77
0.77
0.72
0.63
0.49
0.44
0.44
0.42
0.37
0.34
0.33
0.32
187,795,283
126,463,655
77,190,937
35,682,057
10,390,648
10,198,111
9,177,044
8,300,000
6,344,798
6,331,195
5,911,667
5,200,000
3,996,560
3,600,000
3,582,432
3,478,649
3,000,000
2,800,000
2,721,042
2,603,300
514,767,378
306,511,437
821,278,815
62.68
37.32
100.00
Myer Annual Report 2022Directors’ Report Year in Review Remuneration ReportFinancial Statements 102
Substantial shareholders
As at 16 September 2022, there are three substantial shareholders that Myer is aware of:
Premier Investments
Dimensional Fund Advisors
Mitsubishi UFJ Financial Group Inc
Total
Date of last notice
8 August 2022
2 December 2016
31 August 2022
Number of securities
in last notice
187,795,283
57,539,611
41,129,409
%
22.87
7.01
5.01
34.89
The above table sets out the number and percentage of securities held by substantial shareholders in Myer as disclosed
in their last substantial shareholder’s notice. Note that those shareholders may have acquired or disposed of securities in
Myer since the date of that notice. A substantial shareholder is only required to disclose acquisitions or disposals where
there has been a movement of at least 1% in their shareholding.
Voting rights
Shareholders may vote at a meeting of shareholders in person, directly or by proxy, attorney or representative, depending
on whether the shareholder is an individual or a company. Subject to any rights or restrictions attaching to shares, on a
show of hands each shareholder present in person or by proxy, attorney or representative has one vote and, on a poll,
has one vote for each fully paid share held.
Presently, Myer has only one class of fully paid ordinary shares and these do not have any voting restrictions. If shares
are not fully paid, on a poll the number of votes attaching to the shares is pro-rated accordingly. Options and performance
rights do not carry any voting rights.
Performance options and rights
Myer has unlisted performance options and rights on issue. As at 16 September 2022, there were 24 holders of
performance options and rights.
Myer Annual Report 2022
103
Corporate
directory
Registered office
Myer Holdings Limited
Level 7, 1000 La Trobe Street
Docklands VIC 3008
Myer postal address
Myer Holdings Limited
PO Box 869J
Melbourne VIC 3001
Company secretary
Paul Morris
Myer customer service centre
PO Box 869J
Melbourne VIC 3001
Phone: 13 69 37 (within Australia)
Auditor
PricewaterhouseCoopers
2 Riverside Quay
Southbank VIC 3006
Securities exchange listing
Myer Holdings Limited (MYR) shares are listed
General Counsel and Company Secretary
on the Australian Securities Exchange (ASX)
Shareholder enquiries:
Share registry
Link Market Services Limited
Attn: Myer Holdings Limited
Locked Bag A14
Sydney South NSW 1235
Myer shareholder information line
Australian Telephone: 1300 820 260
International Telephone: +61 1300 820 260
Facsimile: +61 2 9287 0309
www.linkmarketservices.com.au
Websites
myer.com.au
myerone.com.au
myer.com.au/investor
Find us here
Facebook.com/myer
Instagram.com/myer
Investor relations and media enquiries
Twitter.com/myer
Email: myer.corporate.affairs@myer.com.au
Sustainability
Email: sustainability@myer.com.au
Youtube.com/myer
Designed and produced at www.twelvecreative.com.au
Myer Annual Report 2022Directors’ Report Year in Review Remuneration ReportFinancial Statements