PREMIER INVESTMENTS DELIVERS RECORD FIRST HALF NPAT

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1 16 March 2018 PREMIER INVESTMENTS DELIVERS RECORD FIRST HALF NPAT RECORD INTERIM ORDINARY DIVIDEND HIGHLIGHTS FOR 1H18 Premier Investments underlying recrd net prfit befre tax (NPBT) f $110.5 millin, up 9.9% n 1H17 1 Premier Investments reprted a recrd net prfit after tax (NPAT) f $78.6 millin, up 9.4% n 1H17 Premier Retail s recrd underlying earnings befre interest and tax (EBIT) f $102.5 millin, up 10.2% n 1H17 1 : Ttal sales up 7.0% t $630.1 millin Like-fr-like (LFL) sales up 2.4% n cnstant currency basis Smiggle s glbal sales f $170.7 millin, up 26.7% n 1H17 with the pening f 35 new stres glbally and cntinuing strng LFL grwth Peter Alexander s sales f $114.4 millin, up 15.0% n 1H17 with strng LFL grwth and the pening f 12 new stres Online ttal sales grwth f 71.2% n 1H17 t $56 millin. Original 2020 nline target f $100 millin in annual sales expected t be achieved in calendar year tw years ahead f riginal plan Prtmans and Jacqui E delivered impressive LFL sales grwth Recrd interim rdinary dividend declared f 29cps fully franked, up 11.5% r 3 cps n 1H17 (1H17: 26cps) Premier Investments Limited ( Premier ) Chairman, Mr Slmn Lew said: Premier Investments has again delivered a very strng result. Premier Retail tday annunced an underlying first half EBIT f $102.5 millin. This is the first time the business has achieved an underlying EBIT abve $100 millin fr a half. It was nly tw and half years ag that we annunced, fr the first time, a full year underlying EBIT abve $100 millin. This utstanding achievement nce again demnstrates the ability f Premier s Bard and executives t bth set a strategy and rigrusly implement that strategy t deliver superir returns t sharehlders despite perating in a challenging market. Premier tday reprted underlying net prfit befre tax f $110.5 millin fr the 26 weeks ended 27 January 2018, up 9.9% 1. The reprted net prfit after tax fr the half was a recrd $78.6 millin, up 9.4%. Premier Retail s recrd underlying EBIT f $102.5 millin was up 10.2% n 1H17 (1H17: $93.0 millin). 1 1 PMV 1H18 underlying EBIT and underlying NPBT excludes cst incurred in relatin t its investment in Myer Hldings Limited ($0.9m) including preparatin fr legal actin; csts incurred regarding the Melburne Head Office mve f Premier Retail t Premier Investments wned prperty scheduled fr April 2018 f $2.0m (Premier investment divisin $1.8m; Premier Retail divisin $0.2m); and ne-ff csts investing in Smiggle Eurpe Expansin f $0.3m, all included within Ttal expenses in the statutry accunts. PMV 1H17 underlying EBIT and underlying NPBT excludes nn-recurring csts f $3.0m regarding the finalisatin f the ne-ff litigatin matter previusly reprted. Page 1 f 7

2 Ttal sales fr Premier Retail were up 7.0% n 1H17 t $630.1 millin. Grup LFL sales were up 2.4% n a cnstant currency basis. Premier Retail CEO, Mr Mark McInnes said: We are relentlessly fcused n implementing ur strategy. We identified in 2011 that Smiggle and Peter Alexander were unique brands with persnalities driven by inhuse design, research and innvatin. We set ut t invest in these businesses and grw them aggressively. We als identified nline as an essential and cmplementary channel fr ur brands. Again, we invested, nt nly in custmer nline experience, but als in a natinal distributin fulfilment centre and supply chain infrastructure t maximise returns. In ur cre apparel brands where we fresaw increased cmpetitin, we clarified ur market psitin, invested in prduct merchants, invested in prduct ranges and delivered cst efficiencies. In particular, we sught, and we cntinue t seek, rents in line with centre perfrmance. We have clsed and will cntinue t clse unprfitable stres. Smiggle glbal sales fr the half were up 26.7% t $170.7 millin. At the end f the half, Smiggle had 332 stres acrss Australia, New Zealand, Singapre, England, Sctland, Wales, Nrthern Ireland, Malaysia, Hng Kng and the Republic f Ireland. The brand pened 35 new stres glbally during the half. We are delighted t annunce that Smiggle will pen the brand s glbal flagship stre n Oxfrd Street Lndn in May Managing Directr f Smiggle, Jhn Chestn, leads Smiggle s strng and fcused glbal management team. The team cntinues t investigate new high value cuntries f size and scale and is planning t pen the first stre in the Netherlands in Q2 FY19. Peter Alexander achieved sales grwth f 15.0% t $114.4 millin during the half. We lk frward t the launch f the full range f Peter Alexander Bath & Bdy and, ur extended childrenswear range and the cntinued expansin f P.A. Plus size during the secnd half. These grwth initiatives frm part f the 2020 Peter Alexander grwth strategy with the aim f delivering annual sales abve $250 millin by FY2020. The Peter Alexander business, led by Judy Cmber and Peter Alexander, is delivering n this strategy and tracking well ahead f expectatins. Our nline business, nce again, significantly grew with ur nline sales fr the half up 71.2% n 1H17. Sales frm this channel represented 10.2% f the respective markets sales. Tday, we are delighted t annunce that the nline divisin, led by Gergia Chewing (Grup General Manager Internet & Marketing), nw expects t reach ur riginal 2020 target f $100 millin in annual nline sales in the current calendar year. Our custmers are rapidly chsing the nline platfrm frm which t shp. As a result, we will cntinue t invest in the technlgy, peple and new marketing initiatives t deliver a wrld class platfrm and custmer experience. Due t ur strategic investments ver the last seven years and fully integrated nature f ur business, the nline channel is extremely prfitable with the EBIT margin significantly higher than the grup average. PREMIER RETAIL TRANSFORMATION FOCUS ON GROWTH & INVESTMENT Grwth Grw Smiggle significantly Grw Peter Alexander significantly Expansin and grwth f nline businesses Cre Grss margin expansin prgram Organisatin-wide cst efficiency prgram Rejuvenatin f cre apparel brands Page 2 f 7

3 GROWTH INITIATIVES DELIVER Smiggle s recrd result The brand achieved recrd glbal sales f $170.7 millin in 1H18, up 26.7% n 1H17 underpinned by the pening f 35 new stres and strng like fr like sales grwth. Over 60% f Smiggle sales fr the half were frm utside f Australia. At the end f 1H18 Smiggle had 332 stres acrss Australia, New Zealand, Singapre, England, Sctland, Wales, Nrthern Ireland, Hng Kng, Malaysia and the Republic f Ireland. Smiggle Australia and New Zealand The Australia/New Zealand market delivered strng LFL and ttal sales grwth in 1H18 with fur new stres pened in the half and targeted stre refurbishments made in key flagship destinatins. Smiggle Asia The Smiggle Asian divisin had an exceptinally strng half. Singapre, the mst mature f the Asian markets, enjyed strng LFL grwth with turists prviding valuable insights int ptential new Smiggle markets. Smiggle in Hng Kng pened three new stres in the half taking the ttal t 13 stres, in line with the riginal plan. Smiggle Malaysia pened tw stres during 1H18 taking ttal stres pen t 13. The brand nw expects t have between 17 and 19 stres perating in Malaysia within three years f first pening. This is well ahead f the riginal plan. Smiggle Eurpe Smiggle UK is already the single largest cuntry market fr the brand by sales and management als expects it t be the largest market by stre ftprint by the end f the financial year (FY18) with an expectatin f between 132 and 142 trading stres by July This will include the pening f a glbal flagship stre n Oxfrd Street, Lndn in May The UK transactinal website has gne frm strength t strength since launching in March Smiggle UK s nline sales in 1H18 significantly utperfrmed Premier s mst ptimistic expectatins. Given the rapid rise f the UK nline business ver the last three years the grup will cntinue t invest in technlgy, peple and marketing t maximise this channel, as a result the brand will cntinue t adpt a very prudent capital allcatin plicy twards any new Smiggle stres. The UK business reaffirms the expectatins f $200 millin in annual sales by The Republic f Ireland traded well ahead f expectatins with five stres pen at the end f the half. The key Irish flagship stre in Graftn Street (Dublin) will pen in 2H18. Smiggle will enter cntinental Eurpe in Q2 FY19 with the pening f the first stre in the Netherlands. Peter Alexander Grwth Plan tracking well ahead f expectatins Ttal sales at Peter Alexander fr the half grew by 15.0% n 1H17 t $114.4 millin with strng ttal and LFL sales grwth in bth Australia and New Zealand. The 2020 Grwth plan is prgressing ahead f expectatins, with annual sales expected t exceed $250 millin by FY20: Eight stand-alne stres and fur Myer cncessins pened in 1H18; Seven new stres cnfirmed fr pening in 2H18; An expanded range f P.A. Plus size delivering exceptinal grwth; Cntinued grwth frm ur nline stres; The launch f ur Peter Alexander Bath & Bdy categry in April 2018; A significant expansin f Peter Alexander s childrenswear; and The first Peter Alexander Junir stand-alne stre due t pen at Highpint Shpping Centre (Victria) in Q4 FY18. Page 3 f 7

4 Online nw expects t deliver $100 millin in annual sales tw years ahead f riginal 2020 plan Premier Retail grew nline sales fr the half by 71.2% t $56 millin. The nline business delivered 10.2% f the sales in cuntries and brands with a transactinal website. The nline business is highly prfitable with EBIT margin significantly higher than the grup average. Tday, due t the investments made since the 2011 strategic review, Premier Retail is able t fully service custmers whether they chse t shp in stre r nline. Premier is delighted t annunce that the business expects t reach its riginal 2020 target f $100 millin in annual nline sales in calendar year 2018, tw years ahead f the riginal plan. 1H18 EBIT MARGIN UP 47 BASIS POINTS Premier Retail s underlying EBIT margin grew by 47 basis pints in 1H18, the sixth cnsecutive year f EBIT margin grwth in the critical first half. 1 Grss margin strategies delivering Premier Retail s grss margin f 63.2% fr the half was delivered thrugh the effective implementatin f key grss margin strategies: 1H18 results were achieved ntwithstanding significant external headwinds in the apparel sectr, with retailers cntinuing t discunt deeper and fr lnger t remain cmpetitive; lng term freign currency hedging plicies allwing fr lng term merchandising planning; direct surcing initiatives cntinuing t deliver benefits frm new and existing suppliers; surcing frm new gegraphies; investing in better merchants delivering better prduct; a fcus n disciplined executin f markdwn management; and significant grwth frm higher margin brands Smiggle and Peter Alexander. Premier Retail's inventry psitin was clean at end f the half. Cst efficiency and supply chain Cst f Ding Business fr the half decreased by 144 bps as a percentage f sales t 47.0%. The grup delivered nging cst efficiencies, despite structural inflatinary pressure. Over the past five years Premier Retail has pened 260 new prfitable Smiggle and Peter Alexander stres (190 f these utside f Australia) but Premier Retail has als clsed 82 stres ver that time including ten during 1H18 as part f the nging prgram t clse unprfitable stres. The clsures during 1H18 included Just Jeans and Prtmans Melburne Flagship stres in the Burke Street Mall. These tw stres had been trading fr ver 30 years and cmbined generated ver $5 millin in annual sales in FY17. Premier Retail clsed these stres as a direct result f unrealistic rent expectatins. As cnsumers cntinue t increase their shpping nline, Premier Retail will cntinue t fcus n stre prfitability t drive apprpriate investment and sharehlder returns. Page 4 f 7

5 Premier Chairman, Mr Slmn Lew said: During the half, ur nline divisin delivered 10.2% f the respective markets sales and we are investing in this channel t escalate ur grwth. Custmers are chsing which channels and lcatins they want t shp in, and everyne in the Premier Retail team respects and embraces the custmers chice. Landlrds need t als embrace and respect the changes in cnsumer behaviur and channel chices custmers are making. As we have said befre, where landlrds d nt cntinue t invest in verall shpping experiences and/r adjust their rent expectatins in line with the perfrmance f their wn centres and the majr shift in cnsumer behaviur, further stre clsures will be necessary. Rejuvenatin f cre apparel brands Prtmans and Jacqui E delivered impressive LFL sales grwth Prtmans, under the leadership f Linda Levy, had a very strng turnarund in perfrmance in 1H18. LFL sales were up 19.8% in Q2 FY18 and in January LFL sales were up 33.4%. Jacqui E, under the leadership f Nicle Nacarella, had a strng turn arund in perfrmance in 1H18. LFL sales in Q2 FY18 were up 6.8% and in January LFL sales were up 10.1%. Bth Prtmans and Jacqui E have started the new seasn strngly. Premier Retail CEO, Mr Mark McInnes said: We are delighted with the turnarund in perfrmance in bth Prtmans and Jacqui E fllwing the appintments f Linda Levy and Nicle Nacarella in the middle f 2017 calendar year. Our perfrmance demnstrates ur ability t maximise ur market psitin despite the difficult and extremely cmpetitive clthing markets we perate in. Our perfrmance further demnstrates ur ability t attract high perfrming, key talented executives t ur cmpany, with deep apparel experience and prven track recrds f success. Jay Jays, led by Grup General Manager Linda Whitehead, delivered psitive LFL sales fr 1H18. Jay Jays perates in an extremely cmpetitive and difficult market segment and we are pleased with ur brand psitin and perfrmance. After delivering a strng 4.7% grwth in 1H17, Just Jeans delivered negative 3.6% LFL sales in 1H18. The brand maintains a strng market psitin. Pleasingly Just Jeans, led by Grup General Manager Matthew McCrmack, has returned t psitive LFL sales fr the first six weeks f the new seasn. Premier Retail was extremely disappinted in Dtti s perfrmance and believes it can d much better ntwithstanding that this segment f the market is self-evidently structurally challenged. David Bull has resigned frm Premier and Judy Cmber has been appinted Managing Directr f bth Peter Alexander and Dtti. In additin, Deanna Mylan will re-jin the grup as Grup General Manager ( GGM ) f Dtti reprting directly t Judy. The cmbinatin f Judy and Deanna s deep experience in yung wmen's fast fashin aims t set the brand up fr the future. Dtti expects a turnarund in perfrmance as early as 1H19. Mr McInnes said: "I am delighted t appint Judy Cmber t Managing Directr Peter Alexander and Dtti, recgnising Judy's experience and ability t deliver results. Judy is an utstanding Managing Directr with a lng career track recrd f success in all frms f retail. With Deanna Mylan re-jining the grup as GGM Dtti we have significantly strengthened ur key prduct and merchandising management team t significantly imprve Dtti s perfrmance." Page 5 f 7

6 PREMIER INVESTMENTS BALANCE SHEET AND INTERIM DIVIDEND At the end f the half, Premier s balance sheet reflected free cash n hand f $185.5 millin, its investment in Myer Hldings Limited valued at $54.8 millin plus its equity accunted investment in Breville Grup Limited at $221.3 millin. The market value f Premier s hlding in Breville Grup Limited was $447.4 millin at 14 March Due t the cntinued strength f Premier s balance sheet and the perfrmance f Premier Retail, the Bard has declared an increased recrd interim rdinary dividend f 29 cents per share fully franked, up 11.5% r 3 cps n 1H17 (1H17: 26 cps). The interim rdinary dividend will be payable n 15 May 2018 with recrd date f 1 May Premier s Chairman, Mr Slmn Lew said: The Premier Bard and Premier s executives have cnsistently set the strategy and rigrusly implemented that strategy t deliver superir returns t sharehlders. We are delighted that, frm 1 July 2018, the Australian Gvernment will implement the GST n all nline internatinal sales. This will benefit Premier and all Australian retailers (sharehlders, emplyees and related industries) wh nw will be able t cmpete n a level playing field. ENDS Fr enquiries: Fr investrs and analysts Mark Middeldrf Premier Investments Tel: Fr media Lauren Thmpsn Mb: Based n Breville Grup Limited share price f $12.51 n 14 March 2018 Page 6 f 7

7 APPENDIX Overview f Premier s nn IFRS financial infrmatin IFRS financial infrmatin is financial infrmatin that is presented in accrdance with all relevant accunting standards. Nn-IFRS financial infrmatin is financial infrmatin that is presented ther than in accrdance with all relevant accunting standards. Fr example: ne-ff items, nn-recurring csts, like fr like sales, underlying EBIT, underlying NPBT and underlying NPAT. Any nn-ifrs financial infrmatin is clearly labelled t differentiate it frm reprted/ifrs financial infrmatin Premier Investments prvides recnciliatins in the ftntes in rder t allw the reader t clearly recncile between the IFRS and nn-ifrs financial infrmatin. Premier Investments management believes that the presentatin f additinal nn-ifrs infrmatin in its results presentatins prvides readers f these dcuments with a greater understanding int the way in which management analyses the business as well as meaningful insights int the financial cnditin r Premier s verall perfrmance. The Australian Securities and Investments Cmmissin (ASIC) acknwledges the relevance f nn-ifrs financial infrmatin in prviding meaningful insight as lng as it des nt mislead the reader. Frward lking statements Any frward lking statements cntained in this dcument have been based n expectatins at the date f preparatin f this dcument abut future events. The frward lking statements included in this dcument may generally be identified by use f frward lking wrds such as believe, aim, expect, planned r ther similar wrds. Similarly, statements that describe Premier s bjectives, plans, gals r expectatins are, r may be, frward lking statements. Frward lking statements invlve knwn and unknwn risks, uncertainties, assumptins and ther imprtant factrs that culd cause actual results t differ materially frm the expectatins. Nthing cntained in this dcument is, r may be relied n as, a prmise r representatin as t the accuracy r likelihd f fulfilment f any frward lking statements, except t the extent required by law. Yu are therefre cautined nt t place undue reliance n any such frward lking statements. Subject t any bligatins under the Crpratins Act r the ASX Listing Rules, Premier des nt give any undertaking t update r revise any frward lking statements after the date f this dcument t reflect any change in expectatins in relatin theret r any change in events, cnditins r circumstances n which any such statement is based. Page 7 f 7