I think that the strength of the Premier Investments Limited (ASX: PMV) half-year result today demonstrated that it isn't all doom and gloom in the retail sector.
I believe retailers that have strong brands and relevant product offerings that are suited to consumers' changing needs can still thrive in this tricky consumer environment.
With that in mind, here are two retail shares that I think investors ought to consider buying along with Premier Investments:
Lovisa Holdings Ltd (ASX: LOV)
My favourite retail share on the Australian market would have to be Lovisa. I thought the jewellery retailer was one of the highlights during earnings season last month when it reported half-year revenue of $118.6 million and net profit after tax of $24.8 million. This equated to an 18.9% and 22.5% increase, respectively, on the prior corresponding period. A key driver of this growth was the company's international expansion. Lovisa increased its store network by 10.8% during the period, ending it with 319 stores. While this increase helped lift sales, so did an impressive increase in like-for-like sales. They grew 7.4% on the prior corresponding period thanks to a strong Christmas and Boxing day trading period and management's continued delivery of on trend products. I expect more of the same in the second-half and beyond, especially if its recent expansion into the U.S. market is a success.
Noni B Limited (ASX: NBL)
Another retail share that is high on my list is Noni B. Like Premier Investments' key Smiggle and Peter Alexander brands, Noni B operates in a niche market which I think has plenty of growth ahead of it and limited competitive threats. In the first-half of FY 2018 Noni B achieved first-half revenue of $193.2 million and first-half profit of $11.8 million. This was a 35.1% and massive 379.5% increase on the prior corresponding period. As Noni B operates in the mature women's fashion market, I think it is well positioned to continue this growth as Australia's population ages. Furthermore, I think it faces less disruption from online players such as Amazon.
