The Premier Investments Limited (ASX: PMV) share price has gone bananas, it’s up more than 12%.
The company announced a number of things that could have impacted investors views on the business.
Premier Investments share price
FY23 result preview
It said that its retail division, which includes Peter Alexander, Smiggle, Jaciqu E, Dotti, Just Jeans, Jay Jays, Portmans and Dotti, is expected to report sales growth of 9.7% year on year.
FY23 EBIT (EBIT explained) – pre AASB16 and excluding significant items – for the retail division is projected to be between $355 million and $357 million, which would be growth of approximately 6% to 6.6%. The trading update doesn’t relate to its investment segment, which includes its stakes in Myer Holdings Ltd (ASX: MYR) and Breville Group Ltd (ASX: BRG).
New CEO
It was also announced that CEO and executive director Mr Richard Murray is resigning from his positions. The Premier Retail chief financial officer (CFO) John Bryce will be the interim CEO during this period.
Solomon Lew said it would be “business as usual” while the company works on the strategic review.
Business review
The company also announced today that it was going to review its corporate, operating and capital structure, though the review may not necessarily lead to any change.
Both Peter Alexander and Smiggle are looking to grow internationally while the apparel brands store footprint is being optimised, while exploring new store formats, fit outs and online execution.
The ASX share wants to ensure that each of its brands are best positioned to take advantage in the interests of shareholders.
This review will look at a number of things, including the corporate, operating and capital structure, dividend policies and separation of the group into two or more distinct entities through a demerger.
It will look at capital requirements, business plans, management structures, separation costs and any cost dis-synergies.
Premier has appointed UBS and Arnold Bloch Leibler to advise it on the review.
Final thoughts on the Premier Investments share price
The business has recovered a long way from the gloom last year. It seems like a great business, but it doesn’t seem as good value now and I’m not sure if sales and profit can keep growing how they have been, considering the back-to-school recovery after COVID for Smiggle has already played out, and the weaker economic picture.
But, if there was a share price sell-off, I’d definitely call it an opportunity.
