Thank you for standing by. Good morning. Welcome to the analyst and investor call for MYER's 2021 half year results with MYER's Chief Executive Officer, John King, and Chief Financial Officer, Nigel Chadwick. All participants are on a listen-only mode. There will be a presentation followed by a question- and- answer session for analysts and investors. If you wish to ask a question, you will need to press the star key, followed by the number one on your telephone keypad. I will now hand over to Mr. John King. Thank you, good morning, everybody. Thanks for joining the call today, to investors and analysts, also to the media who joined on a listen-only basis. I'm John King, CEO of MYER, and I'm joined today by Nigel Chadwick, our Chief Financial Officer. Please note that this call is being recorded. I will begin with a quick overview of the half year 2021 results, then I'll hand over to Nigel, who will provide you with more details, then I will speak further on our Customer First Plan. After that, there'll be an opportunity to ask questions. The first half results reflect several positive achievements, including the continued strength of our online business, as well as the sustained disciplined management of costs, cash, and inventory achieved in an ever-changing environment. This strengthened financial position is reflective of our continued focus on profitable sales, management of cash and costs, and continues to put us in a solid position to navigate the volatility COVID continues to present for our business as we continue to work through the challenged CBD environments and the impact of forced business closures. As a board and executive team, we've continued to prioritize the health and wellbeing of our team members, our customers, and the broader communities in which we operate. Customers will have seen this with our enhanced health and safety measures in place across our stores. As a business, we've also supported respective governments across the country in response to their mandated closures. As mentioned, COVID continued to have an impact on our top-line results, particularly with the challenges that remain inherent for the country's biggest CBD locations and the closures in Victoria particularly. Again, the work we've undertaken in the past few years to deleverage and de-risk the business has been essential in offsetting these headwinds. We were assisted by the federal government's JobKeeper program, which ended for us last September. This has kept us connected to our 10,000 team members at a time when there was significant sales impact to our business, has continued to allow us to maintain our workforce as we manage this volatile environment. The dividend continues to remain suspended at this time. To our results today, turning to page four, there are four key takeouts for me to share with you on the call today. Record online sales, improved cost of doing business, increased profit, and a strong balance sheet. In talking to those results in more detail, we had record online sales. Group online sales, now the engine room of the business, up 71% to AUD 287.6 million. Our comparable sales were down 3.1%, but if you exclude our six largest CBD stores, which reflect the current impact of CBD traffic more broadly, our comp sales would have been positive by 6.3%, reflecting the strong performance of our regional and suburban store network. Total sales were down 13.1% to just under AUD 1.4 billion, which was inclusive of the forced closures and the traffic impacts in our CBDs. OGP was down 14% to AUD 539.8 million. As I previously mentioned, our focus on costs have mitigated the trade impacts in parts. Cost of Doing Business was down just under 21% to AUD 325.2 million. EBIT increased by 2.7% to AUD 109 million. Net profit after tax was up 8.4% to AUD 42.9 million. Statutory NPAT of AUD 43 million was up 76.3% on last year, which reflects the individually significant items and implementation costs that were incurred last year. To our balance sheet, net cash position of AUD 201 million at the half end, which is an improvement of AUD 98 million on the previous year. Working capital facility from our banks was not required at all during the half. Inventory was 22% lower year-on-year to AUD 265.8 million, and we have substantial headroom existing across all of our banking covenants. On to page five, operational highlights. There have been some significant deliverables over the half. As mentioned, online continues to grow at record levels, now representing 21% of our business in the first half. This is double what it was a year ago. Investment in our digital experience continues to allow us to take advantage of the consumer shift to online, with improvements made to our browsing and checkout contributing to continued improvement in conversion up 81 basis points on the year. Our customers are responding to this with the highest levels of NPS recorded, our best level of MYER one engagement online, and continued record traffic numbers. There's also been a great deal of work undertaken during the last year to ensure better integration with MYER one, which has led to improved results in this area. Enhancements to the MYER one reward program, including the introduction of a lower minimum of AUD 10 rewards, has led to over one million more customers earning rewards in the first half. We've also increased MYER one engagement across online and in store, with MYER one sales improving to 69.2% of total company sales at the end of the half, representing our highest levels to date. Again, the work that's been undertaken during 2020 to get even closer to our customers to understand what they want to buy, when they want to buy it, and where they want to buy it, and how they want to buy it. We are using this data and analytics for targeted promotions and offers, as well as advertising and marketing to better engage with our customers and MYER one members. Building momentum in MYER one, delivering better insights by leveraging this data, will enable us to continue to connect with our customers across all of our business. In terms of supply chain, as we continue to grow online, we announced our introduction of our 3PL facility last October. This has already fulfilled over 1 million units from the new site. We have over 800,000 units and 45,000 SKUs in the facility, with enough capacity now to double the SKUs and the stock holding during the coming months. Put simply, this is a more efficient process for us, with 25% of all online units fulfilled from the 3PL in Q2 post-opening in September, and growing fast. It means, importantly, a better, faster online experience for our customers, with significant efficiencies for the business. To our stores, we've again recorded our highest levels of customer satisfaction results with our in-store team members. As mentioned, the focus for us was safely executing key trade periods, and we did this with Black Friday stocktake and events like the MYER Melbourne Christmas Windows. In great news for our loyal customers, we reopened Cairns and Belconnen store refurbishments. These smaller formats that have been refurbished and look fantastic, with an improved store layout look and merchandise offer. Local customers have responded positively to this, and we are seeing significantly improved performance in both those stores. We're also continuing to focus with our efforts to reduce shrinkage, which is down AUD 5 million year-on-year. If you could turn to page six. As mentioned, group online sales are now AUD 287.6 million in the first half. Beauty and Home continue to be standouts with significant growth, up 129% and 116% respectively. Pleasingly, we've also experienced significant growth in our menswear business of +96%, as you'll see from the chart. This continued rapid growth reflects several factors, including extensive improvements to the website undertaken during the past three years, and the widespread trust associated with the MYER brand, now ranking 10th in the Roy Morgan Most Trusted Brand Index. We also benefit, as I said, from the improved fulfillment capacity and efficiency resulting from that new 3PL arrangement that was introduced prior to Christmas. I will close by saying that we don't anticipate online growth to be at the same levels during the second half as we experienced during last year's lockdown, particularly during April and May. However, we do expect continued growth as this channel continues to gain momentum as we build range and choice for our customers and operational efficiency. Turning to page seven. In summary, online scale and momentum has accelerated our digital transition. We've continued to focus over the past half to improve the online customer experience, especially in the area of fulfillment. Our stores network continue their enthusiastic and motivated approach with record customer service satisfaction scores, particularly in our regional and suburban stores, as more people shop their local MYER whilst working from home. Importantly, we have a strong balance sheet and minimal debt, we'll be looking carefully as we invest in the future across digital, MYER one, and the store network. We have a clean inventory position and improved stock turn, with aged stock and clearance stock significantly reduced during the period. We are mindful that we continue to face macro challenges, we believe we're in a strong position to mitigate, especially with all the improvements we've made to the business over the past few years. I'd now like to hand over to Nigel, who will talk in greater detail on our financial results, and I'll be back later to update you on our Customer First Plan. Thank you. Over to you, Nigel. Thanks, John. Good morning, everybody. Now we'll do a quick run through the financials, starting on slide nine. Given this is the second year of AASB 16, all the numbers we're presenting today are on a post-AASB 16 basis. Total sales, including concessions, were down 13% for the half year and were obviously heavily impacted, as John said, by COVID-19 closures, mainly in Victoria and reduced footfall in CBD stores, particularly on the eastern seaboard. To give you a sense of the trading impact from the Victorian store closures, the year-on-year revenue delta across the Melbourne metro stores whilst they were closed was just over AUD 130 million. Comparative sales after excluding closed stores were down 3%, again reflecting the reduced footfall in CBDs, including, of course, our two largest physical stores in Sydney and Melbourne, but offset in part by the strong growth in online sales, which were up 71% on the same period last year, and also solid performance in the rest of the store network. OGP was AUD 540 million for the period, and the OGP margin was down slightly by 55 basis points, which we'll touch on a bit later. CODB was AUD 325 million, which was 21% down year- on- year, reflecting cost containment initiatives, but also significantly impacted by the first JobKeeper wage subsidy program and rent waivers in relation to the Victorian lockdowns, as well as some waivers rolled over from last year, which had not been formally agreed at year end. Overall, EBITDA for the period was AUD 215 million, down just under 2%. Depreciation was down AUD 6 million or 6%, reflecting lower CapEx over the last couple of years. Lower depreciation on our lease right of use assets following the impairment taken last year end. EBIT was AUD 109 million, which was up nearly 3% year-on-year, with EBIT margin sitting at 7.8%. NPAT before minor net individually significant items and implementation costs was up 8.4% to AUD 42.9 million. As John said, statutory reported profits after tax was AUD 43 million, up 76% on last year, when we reported some one-off accelerated write downs of inventory as we closed down the clearance store concept and some redundancy costs. Overall, this was a pleasing result considering the subdued trading, particularly in Victoria and the CBD stores during the half. I'll now move to slide 10 and talk a little bit more on revenue. As mentioned earlier, total sales were down 13% during the half. When we break that down further, we can see the main contributor to this were MYER CBD stores, which were down 32% across the period, with the rest of the department store business comprising the non-CBD stores performing substantially better, but still down 5.7%. As I mentioned, comp sales for the group were down 3.1% overall. If we exclude CBD stores from the comparison, then overall, the rest of the business traded up 6.3%. Q2 comparable sales improved compared to Q1, reflecting strong execution, particularly across Cyber Weekend, with the period from 1 November to 19 December comp sales down just 1.6%. Again, if we excluded CBD stores from that, the rest of the network traded up 7.4%. To some degree, we believe the diversification of our product offering, multiple channels to market, and breadth of store footprint have provided some protection in the current environment. For example, some categories have been disappointing in trade, but others, such as electrical or home, have traded up. Second, when people have been working from home, impacting foot traffic in the CBDs, the consumer has switched to shopping at their local store instead. Also, where lockdowns have caused physical stores to be closed, customers have moved to online shopping. Arguably, the diversification of the portfolio has helped mitigate some of the impacts of the pandemic and is something we need to be mindful of as we move forward with space rationalization and editing the product offering. Moving on to gross profit on slide 11. As I mentioned earlier, our GP was down to AUD 540 million, and our margin declined to 38.6% with a number of factors contributing to that. As you can see from the chart, clearly the major year-on-year movement has been from lower volume of sales, primarily from the Vic Metro store closures and the lower CBD footfall. Whilst there were changes in mix between national brands, MYER exclusive brands and concessions, these netted out from a year-on-year comparison perspective. In terms of margin rate, with the prolonged shutdown of the Melbourne Metro stores, we were left with some seasonal inventory that needed to be cleared quickly, and so we discounted that stock to move it through and make way for new season stock. In addition, there was less new inventory in the business early in the period, which resulted in a lower proportion of full price sales than would normally be the case. In addition, lower supplier support due to lower purchases overall, an unfavorable year-on-year delta on FX, and higher relative MYER one program costs following the introduction of the AUD 10 reward card, all had negative impacts. These factors were partially mitigated by a higher mix in the home category at higher margins and a further significant step down in shrinkage expense, which is now sitting at just under 0.9% of wholesale sales compared to over 1.3% a couple of years ago. We're pushing to take it down even further moving forward. As I mentioned earlier, we continue to make improvements to our inventory management, including our ordering and supply chain all the way through to the store floor, as well as clearing seasonal stock on a program cycle. This is improving our stock turn and ultimately our working capital position. Moving to costs on slide 12. Here we can see the major items influencing CODB year-over-year. Once we remove the lease rental expense from the pre-AASB 16 total for last year, we have 1H 2020 CODB at AUD 411 million on a post-AASB 16 basis. We spent an additional AUD 15 million of variable costs in relation to our online sales, which is primarily volume driven, fulfillment costs. We managed to again reduce the operating costs in the stores by further optimizing store rosters off the back of previous technology investments and efficiencies in store management. We also took our cost of operating the head office down by AUD 14 million, which was again, primarily headcount and also marketing improvements. The final three bars to the right of the bridge are the more direct COVID related items. The reduction in staff costs and operating expenses from the Melbourne store closures was AUD 12 million. Rent waivers recorded in this half amounted to AUD 18 million. You will recall at last year-end we mentioned that we'd only recorded rent waivers for when we were closed in April and May to the extent they'd been formally agreed with landlords. There were further agreements reached in this half-year in respect of that period, and also additional rent waivers agreed for the Victorian store closures this half. Finally, the amount of JobKeeper that allowed us to maintain roles during a period of subdued trading, and importantly, to bring the workforce back up quickly and to a higher operating level than we might otherwise have been able to, was AUD 32 million. The chart on the right shows our sort of gradual progress over time from 1H 2018 to today in reducing CODB. Moving to cash flow on slide 13. As you can see from this slide, our operating cash flow before interest and tax has improved markedly to AUD 326 million, and cash conversion at 152%, largely driven by lower implementation costs and well-controlled working capital, improving cash flow by AUD 20 million, despite the unwind of deferred positions from last year. We recovered AUD 7 million in tax as a result of the statutory loss made last year. Net interest was down period on period, reflecting our lower gross debt levels and higher cash balance, more than offsetting the increased margin on our facilities. Cash CapEx was just AUD 14 million, reflecting the significant landlord contributions to refurbs at Cairns, Belconnen and Karrinyup, but also our decision to pause or slow down some projects, such as our point of sale replacement project, whilst we were waiting to see the implications of COVID-19. Happily, these projects are now in the process of ramping up again. We expect the run rate on CapEx to return to more normal levels in the second half and beyond. As you can see from the split of CapEx on the right-hand side, the bulk of our spend continues to be directed at our online business and supply chain optimization. Moving further down the cash flow, that results in free cash flow before financing of AUD 273 million, up 29% on last year. Lease principal payments were up significantly year-on-year, but that reflects incremental outflows in this half from the rent deferrals last year. Net cash flow after lease principal payments was AUD 193 million and was up 35% year-on-year. Clearly, our focus on cash has helped us deleverage the business even further and we'll continue to be disciplined in our approach to both OpEx and CapEx moving forward. Having said that, we've got a number of potential investment opportunities in the pipeline, including continuing to improve our online presence, moving further into a centralized distribution model, and modest upgrades to physical stores and core systems upgrades. Moving on to slide 14 and the balance sheet. The main items I wish to call out on this slide are inventory, which as John has mentioned already, is way down from this time last year. Most of that reduction occurred prior to the last year end, but we've held that relatively steady at those levels during the half, and we're still in that sort of 20%-25% down sort of range today, even though we are replenishing the stores with new season sort of winter inventory at the moment. Importantly, in conjunction with the disposal of clearance inventory this time last year, we implemented a quick cycle which requires us to regularly exit seasonal stock from the business and ensure aged inventory does not build over time. This has resulted in our clearance inventory being at its lowest levels for years, as John mentioned, and it's just 6% of total stock at half year, which is down from 13% this time last year. Much of that clearance inventory has already been moved on since the half year end. Creditors are roughly the same this time as last year, but up from year end, reflecting the normal seasonality of our purchasing. Importantly, and I said this at the full year, but we'll repeat it again, we paid all of our merchandise suppliers according to agreed terms or better throughout the pandemic, and continue to do so. Other assets and liabilities are down from year end, reflecting the payment of rent arrears and agreed government tax deferrals. Lastly, but most importantly, our net debt position, or I should say our net cash position. As you can see, we've improved our net cash position from both this time last year and since year-end. At the half-year, we were AUD 201 million net cash positive, and I'll say a little bit more on that on the next slide. Just to finish off on this slide, John mentioned this already, you can see from the table on the right, we continue to be well within our banking covenants, which continue to be calculated on a pre-AASB 16 basis. As you might recall, we do have some step-ups in our FCCR covenant over the next six months to 1.25 times at July. However, I'm really confident in saying we have, and will continue to have, substantial headroom in all of our covenants over the next several months. Moving on to slide 15, we have a little more detail on our debt position. Just as a reminder, our current facility has two tranches. Facility A, which is a term loan facility of AUD 80 million, which remains fully drawn at all times. Facility B, which is a working capital facility of AUD 260 million, where we draw down and repay depending on our working capital needs. A step-down of this facility occurred, of AUD 20 million, on the 31st of December. It's currently now an AUD 240 million facility. If I can refer you to the chart at the bottom, there are a few points I'd like to make. The blue dotted line shows the gross available to be drawn down within our facilities, including agreed seasonal restrictions where we don't need the availability and so don't pay the commitment fees. The green line shows the actual drawn gross debt we had for the period. As you can see, this was the same throughout the period at AUD 80 million, which was just the term loan facility. Just to be clear, and John said this means we did not need to draw down on the working capital facility at all during the last six months. The peak gross debt I've just mentioned of AUD 80 million compared to last year's peak of AUD 220 million. The orange line on this chart is our actual net debt across the six months. As you can see, we were net cash positive, so we had more cash in the bank than we had drawn debt for the vast majority of the six-month period. Again, just to be clear, this line is net cash or debt, so our actual gross cash balance was AUD 80 million higher than this line. As you can also see from the orange line, our peak net debt of just AUD 30 million was in August. Finally, I'd just like to highlight the significant gap between both the green line and the blue dotted line, so total drawn versus total facility. Also the gap between the orange line and the dotted blue line, which if you add AUD 80 million, is an indicator of liquidity. Just to finish, as we sit here today, we have nearly AUD 400 million of liquidity, which is significantly more than we need. We will factor that into our next refinancing. If I can now move to slide 16 to summarize. Clearly, the first half continued to present significant challenges in the form of forced shutdowns, lower CBD foot traffic, reflecting reduced tourism, and the fact that people continued to work from home. More lately, we've seen the emergence of shorter snap lockdowns. Throughout, we've continued to manage the business tightly and are focused on cost control and cash. This has resulted in a continued reduction in our debt and a reduced reliance on debt financing. We've done a massive amount of work tightening our purchasing and managing the inventory cycle, which has resulted in a significant decrease in inventory, and in particular, the proportion of clearance inventory within the business. It is also contributing in other ways such as less handling and rehandling of stock, which frees up time to focus more on customer service. Our supply chain continues to evolve and is reducing the cost of getting inventory into store and fulfilled for online orders. Even though the 3PL only commenced operations in the second quarter, the blended rate per unit of just the pick and pack element reduced by over 15% from the same time last year. There are savings in many other parts of this process, and we're just at the start of this journey, so we expect more substantial savings to come through in future periods. We're continuing to invest in our online business, which continues to grow strongly, and we expect will continue to do so. However, just to reiterate what John said, the second half will be comping a period last year where our store network was closed for the best part of two months, and our only sales channel was online, which had outstanding sales performance during that period. Our strong balance sheet now gives us improved flexibility to continue our investment in online, supply chain, and selective modest reinvestment in the store network. There is no doubt this result has been supported by assistance from landlords and the government, given the forced closures, continuing lockdowns, and challenges with CBD footfall, we're encouraged by several elements, including the cash position, the continued online growth, improved inventory, and the year-on-year earnings growth. I'll finish there. Thank you, and I'll pass back to John. Thank you, Nigel. If you could turn now to page 18, I'd like to talk more about our. The Customer First Plan and its focus on retail execution, both physical and digital, continues to underpin our approach for the business. Our future vision for MYER is a digital and data-led retailer supported by a smaller network of store space, where we will take an approach similar to Cairns and Belconnen with smaller, better stores with a curation based on local customer needs. We will make improvements to the store itself and to the brand and the product offer. Let me run you through the key parts of our Customer First Plan and our COVID overlay, which is about accelerating, resequencing, and expanding key areas of the Customer First Plan. To page 19. I'm pleased to report that inventory is the cleanest it's ever been, with clearance levels the best I've seen since I've been here. Lower inventory has improved the in-store experience for our customers and contributed to the improved cash position. We've also reweighted our merchandise offer towards home and casual product in the light of the COVID shopper requirements. We will continue to use customer data to drive our buying decisions, making sure we have more of what our customers want and need in our stores and online. As mentioned at the full year, we will continue to make the big brands bigger. For example, Tommy Hilfiger, Maxwell & Williams, salt&pepper, and our premium fragrance offer, to name a few, and this work will continue at pace. Just to take one example, our best performing wholesale brand, Tommy Hilfiger, beat last year by 46%, and we accelerated this growth by refurbishing 10 locations and investing in stock for key events such as Father's Day, Black Friday, Christmas, and Stocktake Sale. salt&pepper was up 110% on the year, and Maxwell & Williams was up 80%. In terms of the customer experience in stores we've mentioned, we've seen customer satisfaction with team members at a record high 83%, up 10% on last year. This is a great result and testament to the work of all our team members across the country, but we have more to do. We have undertaken refurbishments, as we said, in Cairns, Belconnen, and Karrinyup. These stores look great. The offer's fantastic, and the customers are responding. As well as these, we've undertake lower cost relayage and enhancement to the product offer at East Gardens, Carousel, Joondalup, Townsville, and Dubbo, seeing significant improvement in performance post this work, both in sales and profitability. We saw, following their launches, some of their most profitable trading periods with, for example, Belconnen seeing a sales uplift of more than 20% on a third less space and customer satisfaction increasing by 10%. Going forward, we'll continue to be tactical in our approach around store investment and make sure it's focused on stores that provide a greater and quicker return. We'll also be focusing on programs to support the CBD recovery as we start to see workers return and interstate travel return to more levels, hopefully, in the near term. Whilst we do believe international tourism will be probably a year or so away. On page 20, we will talk about online. It still is a major part of our focus going forward. For us, we just see the potential for this business to grow and grow. Over the coming six months, there'll be a focus on the online experience improvements, and we'll continue to improve the customer journey from the moment they log on to the moment they log out. We'll continue to enhance the online fulfillment model to a more centralized distribution model, driving costs down. We'll actively curate and expand the offer and try new products and brands and continue to build and leverage MYER one. In relation to improving the online experience, we will continue the work of the past few years to enhance the customer journey, primarily search functionality, navigation, and product sequencing, which we focused on leveraging the data and automation. These changes will drive a step change in conversion. We'll continue to enhance the online model. As we've talked, we just moved to a larger facility for 3PL, and we'll continue to expand this under our current hybrid model. Over the next six months, the team will focus on cost per order as we drive more of our online sales through our third-party centralized facility, but also provide greater options for the last mile delivery and improving overall delivery options for our customers using our stores as well. We'll continue to actively curate and expand the offer by extending our range via drop ship vendor, giving our customers more choice in the brands that they love. As I mentioned in the last results, the work has concluded in moving our popular MYER Marketplace to myer.com.au, and that we are continuing to grow this offer and test new product categories. Moving to page 21, I'd just like to touch on a bit more about MYER one. MYER one provides us with a competitive advantage with over 5 million members across our omni-channel network. They are engaged, valuable customers, and this program is really starting to regain momentum. As a result of increased focus on MYER one in store and the experience improvements online, MYER one engagement has improved significantly, with MYER one sales improving to 69.2% of total sales. Online has improved to 66.4% of sales, up from 53.7% from the prior year. New member acquisition has grown by 66% year-on-year, with 184,000 new customers joining MYER one in the first half, and this is the same number of the total new customers that joined in the full year in 2019. Notably, this has been achieved without any investment in above-the-line promotion. In October, we enhanced the MYER one value proposition with the introduction of the AUD 10 reward card. This change means that in the first half, over 1 million additional customers earned rewards compared to the first half of full year 2020. These customers have engaged strongly with these AUD 10 rewards, with significant revenue being generated through the issuance of these cards and a much greater multiple of spend with those that use them, and a great reason to return to our store more frequently. More focus has been placed on engaging our customers via MYER one channels to improve the efficiency and effectiveness of our marketing campaigns. Our trade-focused and customer lifestyle management programs have significantly improved by providing more contextually relevant and personalized content to our customers, while providing members with more exclusive content and offers. This includes bonus shopping credit promotions and expanded VIP shopping night, which included an exclusive online execution available only to all MYER one members, and we will do more of this in the coming months and years. Combined, these changes have ensured that MYER one owned channels and promotions have become a significant and efficient driver of sales. In terms of future developments, MYER will continue to focus on enhancing the MYER one value proposition and further developing customer-driven offers, benefits, and communications in order to support the execution of the Customer First Plan. This will include providing more exclusive MYER one pricing and bonus shopping credit promotions to provide increased value for our members, improving the tier structure and associated benefits to provide a more engaging and motivating experience for our members, allowing them to move easily up a tier as they trade through the year with us. Engaging customers with a more personalized and contextually relevant content to meet their preferences and their needs. We turn to page 22. We are continuing with our work to reduce space and improve our stores. Whilst the impact of COVID has slowed down this progress as we negotiated with landlords last year on COVID-specific related issues, the plan is still on track in terms of the space reduction. Over the period, our priority was executing the rent waivers, as Nigel touched on, AUD 18 million in the first half 2021, with the focus now shifting to trading well through key trade periods, which I think our teams delivered. Furthermore, new leases were negotiated at Morley and Highpoint, including the hand-back of one floor at each store, with handover scheduled to occur in March and June, respectively. Our approach remains still to have either less stores or smaller, better curated stores, and we will provide further updates in the coming months in relation to this. On page 24, in conclusion, we will continue to deliver against our Customer First Plan with the revised COVID overlay to ensure we capitalize on the opportunities that exist in this new COVID normal retail world. We have a plan. We're continuing to deliver against it, irrespective of the environment we're in. We'll continue to focus on profitable sales and disciplined management of cash and costs. We'll continue to optimize our space and make strategic store improvements. We will be a digital and data-led retailer supported by a smaller network of store space. We will continue to accelerate key parts of the plan where we see opportunities arise. It's clear that online is the key focus of this work. However, our suburban and regional stores are a core strength. We will capitalize on these over the coming periods as the CBD stores start to recover. As an exec team, we believe the business is on the right footing for this new COVID normal retail world. We will be seizing on the opportunities that exist, putting customers first in everything that we do. Thank you. I'll finish there, and we'll now open the call up for questions. Thank you. Thank you, John. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up your handset to ask your question. Your first question comes from Bryan Raymond from Citi. Please go ahead. I just want to dig into this gross margin decline a little bit. I understand the reasons you've outlined there, but the overall industry-wide reduction in promotional activity has swamped a lot of those factors for other retailers. I just want to maybe get a feel from you both, how you saw the promotional environment, particularly in Black Friday, Boxing Day, and whether you've participated in that reduction in promotions. Thanks. Yeah. We also reduced our promotional activity. From a year-on-year dollar basis, promotions were down 18% in dollar terms year-on-year compared to wholesale sales down 11%. There was a 3% reduction from 36%-33% of wholesale sales position. That's been offset by mix within our portfolio, and really, we tightened purchasing really heavily into probably in the second half of last year, that's what sort of caused us to have a greater proportion of seasonal sort of discounted inventory than we would normally have had. It sounds like the first part of the half, I guess, was a real tough one for you when you obviously didn't buy enough. There wasn't enough new stock on the floor at full price. You also had to clear all that stock in the Melbourne stores. Yes. Yes, that's right. Yeah. Exactly. I understand the Melbourne lockdown, clearly. The question I've got more is, you've got a national network, and your stores outside of Melbourne perform, and outside of CBD, perform quite well. I know you are still building out your centralized distribution model, but was there any way you could have mitigated some of this by shifting that stock into other markets, so bringing it to Sydney, bringing it to other markets? It just seems like while there was disruption everywhere, Melbourne was obviously far worse than elsewhere. Was there a way to mitigate some of this or did you try that? We moved some, where it was appropriate to do so. Obviously, we shifted a lot of it to online. The sheer cost of moving vast amounts of stock interstate, with intermittent border closures, just wasn't practical, Bryan. We just decided to sell it where it was, move as much as we could to online, and then move where it was. It wasn't all clearance, it was a mix of seasonal product. As Nigel said in his words, we've moved to a quick cycle. We don't want to let inventory build up and become aged. That was why we took the cash position. Yeah. Bryan, you might recall, the stay-at-home orders in Victoria were quite strict, our staff would not have been allowed to go into our stores to actually package up inventory and put it on a truck. That was not an allowed activity in Victoria. Whilst we managed to do some in allowed periods, for the vast majority of that lockdown period, our staff were not able to actually go into store and do that. Okay. Oh, sorry, were you going to add something there? No. No? Okay, great. On the CBD side, obviously with the government part, with subsidies and so on, looking through that, looking at the waterfall on slide 12, of course, say the store cost reduction, and support office reduction, how much of that is permanent in a way, versus, say, because you had temporary store closures during the period, and variable costs obviously would've come off a bit. I'm trying to understand how much that we should be building into next year's or second half of next year's numbers. It's a good question. Undoubtedly, it's been difficult to sort of fully separate all of those bars. I think in terms of the store cost reduction, the vast majority of that is permanent. Because as you can see, we've actually reallocated, particularly for the Melbourne Metro store closures into the bar two across. The reason why I say that, there's marketing cost savings were the predominant contributor to that. We think that is repeatable but is obviously something that will vary from time to time. IT cost reductions of AUD 3 million, we think that is sustainable. An area like our merchandising team, their costs were down AUD 3 million for the period. If you think about that, there's been no international travel allowed over the last 12 months. Where our teams would normally go searching for new ideas and new product overseas, on buying trips, et cetera, that's all been shut down. To a degree, some of that is going to not be repeatable into future periods once international travel opens. Right. Just to confirm, you said that the vast majority of the store cost reduction is permanent, but surely there'd be some wage, some variable sort of cost in that with wages, particularly in, say, the CBD stores. You would have pulled back wages there, which I would hope will rebound with sales. Has that been another bar that I'm missing? No, it is in there. Obviously, the way that we manage our rosters is that we actually run them off our weekly sales forecasts. We take a real time cut of what we think next week's sales look like, and then we push that through Kronos to develop what the store roster looks like for staffing, et cetera. That will be variable so it won't be a case of us plowing additional unwarranted labor back into stores before we see the increase in footfall and sales revenue coming from those stores. Okay. Great. One final one from me, just around the free cash flow and balance sheet. When you said CapEx normalizing, that going back to FY 2019 type levels. How should we think about that? I guess the second part of the question is just around the balance sheet. Obviously, AUD 200 million or just around AUD 200 million in net cash currently. Once inventory normalizes, any other timing things come through, should we expect That number to moderate a fair bit, or is that sort of the go-forward figure? Thanks. With CapEx, in a normal year, we've sort of guided to sort of AUD 65 million-AUD 75 million, as a run rate. Given we've only spent sort of AUD 14 million in the first half, I think it's going to be a number sort of AUD 50 million, mid-AUD 40 million probably, for the full year. I did mention also that we've got a pipeline of additional activity. We want to sort of step up our investments in the online presence. We are digging further into central distribution, particularly given the positive sort of results we've seen from the 3PL to date. We've got plenty of opportunity. Some of our stores need a bit of a spruce up as well. We'll be looking at where we can make some of our store appearances look better, where it's economic to do so. Yeah, next year, I'd say we're back up into that sort of AUD 75 million-ish potential region. We've re-kicked off sort of our point-of-sale project, that's building. We're looking at doing a trial of that in selected stores in this half year, actually. Okay. Then the net cash position. Oh. Yeah is around the right figure, or it's going to be a bit less than that? I mean, we are a cyclical sort of business. As we've been replenishing stores, that has moved downwards over the last few weeks. We expect to be back somewhere similar to that around year-end. Our current forecasts show that we're unlikely to need our sort of facility base over the next six months. Yeah. Okay. Thanks for that. Thanks, Bryan. Thank you. Your next question comes from Mark Wade from CLSA. Please go ahead. Thank you. Good morning, team. I'm just trying to understand the fall in sales. I mean, it's a little bit at odds with what we've seen elsewhere in the sector. Look, I appreciate you've got the big shift from the customers out of the CBD stores and into suburbia and online. You've mentioned that the MYER one sales increased as a percentage of total sales, but the implied fall is about a 7.6% drop in overall sales that have gone through the MYER one card. I'm just trying to understand, have you lost customers overall, or are they just simply spending less? Well, the Victorian stores were closed for two months. When we look at sort of those metro stores, the year-on-year performance was down 49%. That's primarily where it is. Across Sydney, Brisbane, and the other capitals, as we mentioned sort of in our pre-prepared commentary, they were down significantly because people are working from home at the moment and have been encouraged not to go back into the workplace. Until that rebounds, that's primarily what's going on with the sales lines. Okay. I mean, as a follow-up, the MYER one data, I mean, what's that telling you about the spending by the different customer groups you've got? I mean, have they reacted differently or is it fairly uniform across the different groups, however you segment them? Look, no, we've seen an improvement in our tag rate, particularly into Q2, as we've done more direct sort of communication with our customer base and we've put more into direct marketing with them. We have seen a change in trajectory into that sort of MYER one customer base. Also, we've significantly improved sort of our online experience and connecting sort of our online sort of offering into that MYER one customer base, and that's paying dividends as well. I think as well, Mark, these targeted promotions, we did a cosmetics one the other week, and the tag rates were up in the 80s. That's purely because it is targeted at those customers. Online, we expect to grow much more rapidly. If you look at where it was last year compared to this year, from 56. 7 to 66, we expect that to continue, that growth trajectory to continue. I think the angle I was trying to take was, is there a certain segment of your customer base that you've really hung on to really well, and maybe they're even spending more than they did a couple of years ago? Is there others where you feel like they've weakened? No, we're doing that analysis piece now. I mean, I think I'm not trying to dodge the question, but COVID has impacted quite a lot of spending and who's been spending, and we've had a lot of new customers come into the site. We are doing some work on that, and we will keep you informed on that. Underlying, in terms of the overall sales, the CBDs, the difference between us and other retailers is, you take Melbourne and Sydney alone, they're 20% of our sales. When you add in the other CBDs, you're up towards almost a third. When you take the CBDs out, the overall company sales are up 6.3 on a comp basis. I think two parts to the question there. The CBDs will take time to recover. We've recovery plans in place for those, and we're going to maximize as much as we can in those suburban stores where the CBD customers are now working from home. Hence we've enhanced the product ranges and the offerings in those. I think Tommy Hilfiger was a classic case in point, where Miranda took more than Sydney when we did the event last year. We'll continue to redefine the MYER one program over the course of the next six months, and we will keep you posted, and we probably will do a piece at the end of the full year on segmentation as we come through into hopefully a more COVID normal retail world. The threat of snap lockdowns, et cetera, still remains there. We remain cautiously optimistic about what we can do over the next 6- 12 months. Last one, John. It's really pleasing to see that the customer satisfaction with regards to service increase again. You've got your Net Promoter Score figures in there. I haven't seen that before, and that's up. It looks like the customers are responding quite well to the initiatives. Are there other aspects of the customer offer you're still not quite happy with? How do you get new customers to find out about it? Yeah. I think MYER one is a great tool. I think our targeted marketing has been really successful, and we'll do more of that. We're being rifle shot rather than shotgun. We will absolutely do more and more of that. I think the in-store experience as well has improved because of the lack of stock, which might seem a bit perverse. What it means is that the stock comes in the back door and goes straight onto the floor. Everyone's focused on being on the shop floor. Year-on-year, we have more people serving customers than we did last year because they were out the back trying to find and get rid of old stock. The benefit of lower inventory, improved merchandise cycle, the quick cycle allow us to have more people on the shop floor. I do think there was When we came back from lockdown, and I noticed it because I was in stores every time we reopened. There was a real connectivity to the customer from our team members and vice versa. It was like, welcome back, that human contact piece. Without getting all fluffy, I do think that the technical stuff is there's more people on the floor, there's less stock for them to mess about with at the back of house. Also what we've done is we've continually localized our approach to our merchandise offer in terms of what are the customers buying, looking at what they're buying from a postcode level online, and then making sure that the store offer reflects that as well. There's more work to be done, there's no question about that. The good news is the trajectory is going in the right direction. No doubt. Thanks again, guys. Thanks, Mark. Thank you. Your next question comes from Johannes Faul from Morningstar. Please go ahead. Hi. Good morning. I was just trying to get a bit of a better feel going forward on how labor and rental expenses might look like when I think about slide, I think it was slide 12 on the CODB line. Those rent waivers, those are all one-offs, those savings? Is there any of that to be expected to be carrying into the second half or even going forward? Well, I might remind you, Johannes, this waterfall is actually on a post AASB 16 basis. Those rent waivers that we've shown there are actually one-offs that we were allowed to bring into operating expenses under the exception rule on leases. This chart no longer includes any core lease rental expense. Okay, great. How should we think about that going forward? Were you able to negotiate rent reductions during the period? We've continued to get some rent reductions during the period, and obviously, some rent savings will come through in future periods because of closures that we've done over the last 12 - 18 months, which will take rental expense down as well. We're continuing to talk to our landlords about space reduction, et cetera. I think it's fair to say that with COVID, and then sort of quickly off the back of that, moving into our key trading period, we did have a pause in our momentum there, but we're regrouping now and we're sort of actively back in discussion with the landlords around space, et cetera. Okay. I guess on the labor cost side, thinking about the net JobKeeper subsidy, obviously that's gone now going forward. You mentioned that on the store cost reduction front, you're going to, I guess, correlate your labor expenses with sales uplifted. Does that mean wage costs won't increase dramatically going forward? Because it's variable, if the CBDs bounce back, then we'll get a relative shift in the store wages line because we need to maintain that trajectory on our customer service metrics, which is a really important thing for MYER. We've been through many, many years of people saying they can't find someone to serve them or people are stood around chatting and those types of things. It's a really key focus area for us. Now, you potentially will see a re-increase in store wages as we see the CBD locations bounce back. Just in terms of the trading after January, I think you mentioned that online, the strength has continued. How is it looking overall when I think about total sales or comp sales in stores? I think it's three buckets really. There's online which has continued to be strong as we add more product into it. As we said, we're going into the comp period where we were shut last year, so we don't anticipate to be having the same sort of uplifts. There's the suburban and the regional stores, which we're putting in new product and maximizing our opportunities there. There's the CBD recoveries, and they're recovering at different rates. If I look at during COVID, we're looking at 50%-60% down in some of those CBD stores, particularly Melbourne, and closely followed by Sydney. If I look now, we're getting down into the 30%s with those stores. Adelaide's sort of positive. Perth's moving back into positive territory. Brisbane's a little bit off, but not far away. I think it'll take time, and there's three sort of categories of footfall around those CBDs for us. There's people returning to work, which in Melbourne is, I'm looking out the window here at an empty NAB building and an empty ANZ building. There's not a lot of people coming back to work yet in Melbourne. We've got Sydney, where they're starting to come back to work, but again, there's no interstate tourism and there's no international tourism, and certainly in Melbourne, only one in seven of foreign students have come back into education. I think it's an evolving feast over the next few months, and we don't have a crystal ball. If we did, we'd be crystal ball retailers. I think for us, it's just a question of managing everything on a local basis and being tactical as we drive through. In terms of just on your earlier point about labor and sales, this isn't anything new. We've been doing this for quite some time, this Kronos system. It really just does match labor to increasing sales. If we increase sales, we'll increase the payroll around that. Obviously, we'd expect to see the margin grow as well. Okay, great. Just on the supply chain, are you seeing any difficulties with getting product into the country? I think, as with everybody, there was issues around ports, there was issues around factories getting back post-COVID last year. We've seen a few minor delays. Some of the global brands have had issues in terms of getting stock. As we look forward, we're pretty confident that we'll get what we want. Certainly, if you look at the likes of Tommy, with those numbers, we were taking that product from Europe and elsewhere. Great. Thanks, John, thanks, Nigel. Thank you. That's it. you. That's it. Thank you. There are no further questions at this time. I will now hand back to Mr. King for closing remarks. I just want to say thank you, everybody, for joining us today. Obviously, we'll be speaking to some of you separately on a one-to-one basis over the next couple of days. Thanks for listening, and stay safe.