CML 5.56% 1.9¢ chase mining corporation limited

Friday 7 June 1:17 PM UPDATE 2-C. Myer continues s

  1. 4,330 Posts.
    http://au.dailynews.yahoo.com/finance/20020607/reutersfinance/1023419832-3892961320.html
    ---------------------------------------------------
    Friday 7 June 1:17 PM


    UPDATE 2-C. Myer continues structure review
    ADVERTISEMENT


    (Adds Woolworths CEO, analyst comments, updates shares)

    SYDNEY, June 6 (Reuters) - Australian retailer Coles Myer Ltd, which has said it will axe underperforming businesses in 2003/04, said on Friday it continuously reviews its structure, including the use of outside advisers.

    "The board and senior executive continuously monitor progress in implementation of the strategic plan," chief executive John Fletcher said in a statement.

    "As part of this process, we periodically review the need for structural alternatives and seek advice from external advisers as required," Fletcher said.

    Market scrutiny of the food, liquor and merchandise retailer Coles Myer is heavily focused on its loss-making department store business. Investors see its KMart and Target discount chains as a good fit with its defensive supermarket and liquor operations.

    Rival grocer and general merchandise retailer Woolworths Ltd said on Friday it would consider buying some parts of rival Coles Myer Ltd's discount chains Target and KMart if Coles was to sell.

    "If Mr Fletcher came to the view that some of the Target stores were surplus, should that occasion occur, Woolworths would be interested," Woolworths chief executive Roger Corbett told Reuters.

    Corbett, who aims all Woolworths' undertakings at low-margin, high-volume businesses, said he would also look at KMart stores but was uninterested in any department stores like Myer-Grace.

    Asked whether new stores would be converted to Woolworths' Big W general merchandise brand, he said: "Most likely."

    Coles Myer shares were steady at A$6.55, while Woolworths lost four cents to A$13.28 in a softer market at midsession.

    WOOLWORTHS FAVOURED STOCK

    Coles Myer has notched above the 10-month low close of A$6.20 touched in May after the company lowered its profit forecast, triggering bad memories of a trio of warnings the year before.

    The group was seen as a turnaround play under Fletcher, and its stock rose 40 percent in the six month to mid-February, a premium the market has since retrieved.

    Woolworths, a market darling which regularly raises its earnings outlook, hit a record high close of A$13.59 in April.

    "There are many people who believe Coles Myer may require a surgeon's treatment, rather than a physician's treatment," Woolworths' Corbett said.

    In a five-year strategic plan set out on March 26, Coles' Fletcher said he saw fiscal 2004 as the timeline for reviewing its structure, which investors believed would centre around its troubled general merchandise and apparel (GM&A) division.

    He told investors earlier this week the GM&A structure would be reconsidered no later than 2003/04, spurring talk that a break-up was under serious study.

    "The timeline has always been the same, and that was that it would be before financial year 2004," a Coles Myer spokeswoman told Reuters.

    The group may close or change up to 10 of its 73 Myer Grace stores next year, she said, clarifying Fletcher's remarks at the conference, which was closed to the media.

    "What John said at the conference was that as leases came up for renewal, and if it made sense to put a different format in it, we would look at it," she said.

    Australia's federal government is expected to enact new tax laws on or about July 1, including corporate demerger tax relief, which some investors said could speed a department store review.

    Most analysts reject further format changes after its disastrous downmarket shift several years ago.

    "I'm not a huge fan of the idea. They should close the stores or find a way to make them work," Richard Cahill, retail analyst at ABN AMRO.

    ($1=A$1.75)
 
watchlist Created with Sketch. Add CML (ASX) to my watchlist
(20min delay)
Last
1.9¢
Change
0.001(5.56%)
Mkt cap ! $3.932M
Open High Low Value Volume
1.9¢ 1.9¢ 1.9¢ $600 31.57K

Buyers (Bids)

No. Vol. Price($)
2 57958 1.8¢
 

Sellers (Offers)

Price($) Vol. No.
1.9¢ 73282 2
View Market Depth
Last trade - 11.22am 24/01/2020 (20 minute delay) ?
CML (ASX) Chart
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.