unfairly undervalued vs peers, page-15

Interesting article relating to AUD

Mr Brooks (or author) seems to contradict themselves when one minute the AUD fall is good for business, then Mr Brooks is playing down the fall as being small and of no great concern.

The 20% of goods 'affected' i imagine are the inhouse brands (usually high margin products responsible for much of GP) the other 80% they can squeeze suppliers on, yet there is a limit to what they can load onto their suppliers before either party moves on (As I have done!!!) and Myer moves on to second third and fourth choice product selections.

I am aware of the resilience these large retailer enjoy in this respect, but by no means is this a good thing for the industry.

Bring on the savage eoy discounting! I haven't bough any business shirts for about err 11 months..

Sentiment: ST Buy the dips and Sell the peaks as she goes down the stairs..

Article:

http://au.finance.yahoo.com/news/myer-boss-fan-falling-aussie-105519254.html

Myer boss Bernie Brookes says he's a fan of the falling Australian dollar as it will have more benefits for the department store than downsides.

After spending most of the past two years trading above the US dollar, the Australian dollar fell below parity last week.

Mr Brookes said the high Australian dollar had both benefits and disadvantages for Australian retailers.

He said while it may increase the prices Myer paid for some products sourced overseas, in the long term it had many more benefits.

The Myer boss said a lower Australian dollar would deter consumers from buying on foreign websites and travelling overseas, while also attracting more tourists to our shores.

"We're actually fans of a decrease in the Australian dollar for those reasons and the benefits in our business outweigh any of the detriments," Mr Brookes said.

Myer had hedged against the Australian dollar for the next 12 months, so there would be no short-or-medium-term effects.

While there could be some increase in costs in the long term, if the Australian dollar continued to depreciate only 20 per cent of Myer's products could be affected.

"We're not overly concerned for all those reasons in the small decrease in the Australia dollar and it's not as though it's gone to 70 or 80 cents it's only gone down a couple of pennies," he said.

"And it's only a couple of pennies, not 70 or 80 cents."

Myer would also try to change suppliers or negotiate lower prices if the Australian dollar caused its costs to rise.

"I do think the customer would not accept and we would do our best to buffer a price increase for the customer by changing our source of supply," he said.

Mr Brookes made the comments while announcing that Myer's third quarter sales were up 0.5 per cent on the previous corresponding period to $652.5 million.