Key Takeaways

  • Premier Retail sales were A$452.8 million in the 26 weeks to 24 January 2026, down 0.5 per cent, with Peter Alexander up 4.9 per cent and Smiggle down 10.7 per cent.
  • FY26 underlying EBIT guidance of circa A$183 million sits below the A$195.4 million Premier Retail earned in FY25.
  • The 25.2 per cent Breville Group stake is carried at A$386.1 million but worth roughly A$1.14 billion at Breville's recent market price.
  • Premier retains no Myer shares: all were distributed to shareholders on 6 February 2025 at 7.2021 Myer shares per Premier share, and a 45 cent fully franked interim dividend has a 4 August 2026 record date.

Two brands, one large listed shareholding and a pile of cash: that is what remains of Premier Investments after it handed its Apparel Brands business to Myer and pushed the resulting Myer shares out to its own owners. The market has marked the shares down sharply since, and the reasons are worth unpacking.

Few ASX-listed companies have changed shape as decisively in the past eighteen months as Premier Investments. The Solomon Lew-chaired group entered 2025 owning five mass-market apparel chains, a large position in Myer and a quarter of appliance maker Breville Group alongside its two best-known specialty brands. It came out the other side with just those two brands, Breville and a substantial cash balance.

That simplification was meant to sharpen the story. The share price has gone the other way. ASX market data shows the stock last trading at about A$13.68, capitalising the company at roughly A$2.18 billion across 159.5 million shares, against a 52-week range of A$10.97 to A$22.92. Simply Wall St put the one-year decline at around 28.6 per cent as at early July 2026.

What Has Happened?

The Apparel Brands transaction completed on 26 January 2025: Premier sold Just Jeans, Jay Jays, Jacqui E, Portmans and Dotti to Myer Holdings, which paid in its own scrip rather than cash. Premier then distributed its entire Myer holding — the new shares plus a pre-existing stake of 31.16 per cent — to its own shareholders on 6 February 2025, at 7.2021 Myer shares per Premier share. The distribution was valued at A$1.03 billion, or A$6.46 per Premier share, with A$387.1 million of franking credits attached. Premier itself therefore owns no Myer shares, a point often misstated; that exposure sits with the shareholders who received the scrip. Breville is now its only listed investment of scale.

The 26 weeks to 24 January 2026 gave the first clean look at the slimmed-down group. Statutory net profit after tax was A$101.7 million, flat on the prior corresponding period, on continuing-operations revenue of A$460.3 million. Profit before tax excluding significant items was A$141.9 million, after A$3.8 million of Peter Alexander United Kingdom entry costs and A$1.0 million of separation expenses. Management guided to FY26 Premier Retail underlying EBIT of circa A$183 million, pre-AASB 16 and excluding significant items and the investment segment. FY26 was a 52-week year ended 25 July 2026, so the outcome is already settled and awaiting disclosure.

Understanding the Company

Peter Alexander is the engine. The sleepwear and gifting brand lifted first-half sales 4.9 per cent to A$312.3 million and ran 146 stores at 24 January 2026 — 127 in Australia, 16 in New Zealand and three in Europe. Its Peter's Dreamers loyalty program passed one million member acquisitions ahead of target. Management said the opening seven weeks of the second half ran well ahead of expectation and above the first-half growth rate, and has identified more than 15 further new or larger-format store opportunities.

The United Kingdom is the brand's first real test outside Australasia, with three stores opened in November 2024 at Westfield London, Westfield Stratford and Bluewater in Kent. In the December half they produced A$3.8 million of sales and A$2.2 million of gross profit against A$6.0 million of expenses. Premier is also exploring international wholesale partnerships as a cheaper route to new markets.

Smiggle is the problem child. First-half sales fell 10.7 per cent to A$140.5 million and the network shrank to 282 stores from 296 — 146 in Australasia, 40 in Asia, 96 in Europe. New managing director Georgia Chewing has led a reset refocusing the brand on its original six-to-12-year-old customer through product simplification and repositioning, with new product and marketing due in the first half of FY27.

Financial and Operational Position

First-half gross margin was 66.9 per cent, up from 65.7 per cent in FY25, and Premier Retail EBIT was A$119.3 million at a 26.4 per cent margin. Online contributed 22.7 per cent of sales and inventory was A$105.2 million, down 1.9 per cent. FY25 delivered A$812.2 million of retail sales and A$195.4 million of underlying EBIT, so FY26 guidance implies a step down of roughly 6 per cent.

At 24 January 2026 the group held A$360.1 million of cash against A$69.0 million of interest-bearing liabilities tied to its property portfolio, carried at A$67.4 million historical cost. Net tangible assets were A$4.55 per share, up from A$3.07. The Breville holding is equity-accounted at A$386.1 million, had a disclosed fair value of A$1,130.4 million at balance date and contributed A$24.8 million of profit.

An on-market buyback of up to A$100 million runs to 23 December 2026; by 14 May 2026 Premier had repurchased just 373,837 shares for A$4.57 million at A$11.50 to A$13.10. The 45 cent fully franked interim dividend, against nil in the prior corresponding half, has a 4 August 2026 record date, taking declared dividends across the FY25 final and FY26 interim to 95 cents.

Why the Development Matters

A sum-of-the-parts, built from disclosed figures, is the obvious lens. Breville had 144,838,561 shares on issue and a recent ASX close of A$31.23, so a 25.2 per cent interest is worth about A$1.14 billion. Net cash at the January balance date was A$291.1 million. Together that is roughly A$1.43 billion against a market capitalisation near A$2.18 billion, leaving about A$750 million — A$685 million after the property carrying value — for Peter Alexander and Smiggle. Against circa A$183 million of guided retail EBIT, that residual sits under four times EBIT.

Risks and Challenges

Concentration is the central structural risk: two brands carry the operating business and one is shrinking. Smiggle's decline is not a one-half event, with sales also down 10.7 per cent in FY25 and the store count contracting in both periods. A reset that depends on new product landing in FY27 leaves several more quarters before it can be judged, and children's stationery faces discount competition and shifting school-supply habits.

Peter Alexander's Australasian base is heavily skewed to Christmas, making second-half earnings structurally lighter — implied second-half retail EBIT under FY26 guidance is roughly A$64 million against A$119.3 million in the first half. The United Kingdom entry remains loss-making, and those losses scale with any rollout before payback.

The Breville holding cuts both ways. It is worth more than half the market capitalisation on a mark-to-market basis, yet Premier does not control Breville, cannot direct its dividends and is exposed to a global small-appliance business with its own tariff, currency and demand pressures. Breville's own 52-week range of A$25.41 to A$37.11 shows how far that backing can swing without anything changing in Melbourne.

What Investors Should Watch Next

The immediate diary item is the 3 August 2026 ex-dividend date, with payment on 20 August. Beyond that, the FY26 result is the substantive event.

Full-year Smiggle sales and the closing store count against 282 at the half.

Peter Alexander full-year growth versus the 4.9 per cent achieved in the first half, plus United Kingdom sales and EBIT.

Closing net cash after the buyback and dividend, and any change to the 25.2 per cent Breville holding.

Conclusion

Premier is now unusually legible by conglomerate standards: one growing brand, one contracting brand, one listed shareholding and net cash. The market ascribes a modest multiple to the retail operations once Breville and cash are taken at face value, but that residual is what one would expect where roughly a third of trading revenue comes from a brand in decline and the growth engine is still spending to prove an offshore thesis.

The more interesting tension is what the board does next. Having returned A$825.4 million of cash dividends over five years on top of the Myer scrip, Premier clearly prefers handing capital back to diversifying. Yet with under A$5 million of a A$100 million buyback used by mid-May and the share price near the low end of its 52-week range, the gap between stated capacity and execution is the clearest test of how the company reads the value on offer.