Myer Holdings Ltd. has reported that electronics now represent the most difficult category of sales across all departments of the store, on the same day that the company posted an alarming fall in profits for the first-half of the 2010 financial year.

Myer reported today that their net profit fell to $21.3 million for the 26 weeks to January 23, from a level of $83.2 million in the previous corresponding time period. The company has indicated however, that it expects a 7% rise in revenue in the next fiscal year. The department store has blamed the drop in net profits on the costs associated with floating the company last November.

Myer’s CEO fronted reporters, saying that the company would meet all fiscal 2009/10 targets for the year, as set out in the IPO prospectus apart from sales growth which will now be between 1-2%.

"We don't believe we'll achieve that three per cent (target.) We believe one to two per cent is prudent and good governance to be able to announce that," Myer’s CEO Bernie Brooks said.

Myer has said that their February sales were far lower than their exceptional January sales.

"February was in line with our expectations, north of two per cent, but it did not fulfil what we were achieving in January. If we had continued what we'd got in January through February and through March then we would be looking at north of three per cent (full year) sales growth But there is a degree of comfort that we are back to the run rate we were getting sort of in November, before December hit," Bernie added.

Across all product categories, sales of electronics remained the biggest issue for Myer during February. Far lower sales of electronics also negatively affected Myer's 2009 Christmas sales levels.

The company seems to be pinning its hopes for revenue growth in 2010/11 on its two new stores at Top Ryde, in Sydney, and Robina, in south-east Queensland, as well as on the refurbishment of their flagship Melbourne store. They have indicated the hope that these stores will add four per cent to the company's revenue base.

Myer's shares were three cents lower at $3.44 at 1pm today.