Lockdowns Short-Term Headwinds for Premier Investments and Myer, but FVEs Unaffected

We have only slightly lowered our full-year revenue and earnings estimates for no-moat Premier and no-moat Myer for fiscal 2021, after considering the impact of lockdowns in South Australia, Victoria, and New South Wales in July 2021. Both Premier and Myer have a July fiscal year end. Although lockdown measures differed by state, nonessential brick-and-mortar retailers--like Premier’s apparel retailers and Smiggle, as well as Myer’s department stores--have been significantly restricted in each state. We’ve reduced our fiscal 2021 revenue estimate for both Premier and Myer by about 1%. And we’ve marginally cut our underlying EPS estimates for Premier and Myer to a profit of AUD 1.65 and a loss of AUD 0.01 per share, respectively, from AUD 1.69 and AUD 0.00 previously. Our forecast revisions are conservative without accounting for possible conversion of lost brick-and-mortar sales to the online channel, and ignoring potential reductions in operating costs during the lockdowns.