In an unexpected backflip, Premier Investments, the retail empire of billionaire Solomon Lew, have now deemed it appropriate to return $15.6 million in JobKeeper subsidies to the ATO on the grounds they were never used. At the business’s half-year result, Premier reported a profit of $188 million, nearly double its profit in the prior corresponding half.
Premier included in its first-half results, a recognition that the group had received a net benefit from “JobKeeper 1” of $15.6 million which would be quarantined and utilised to fund the wages of employees who may be stood down under future state government-mandated COVID-19 lockdowns.
Subsequently, short snap lockdowns took place in Queensland and Western Australia. During these lockdowns, Premier used the “JobKeeper 1” funds recognised as intended, and in keeping with the federal government’s policy of keeping people in jobs, paid the group’s full time and part-time team members their contracted hours whilst they were stood down and unable to attend work.
Following the lockdowns and upon reopening, increased trading from the combined States fully offset the cost of supporting Premier’s teams. Therefore, the “JobKeeper 1” funds were ultimately not required.
The Premier Board, therefore, determined that it is now appropriate to refund the net JobKeeper benefit of $15.6 million to the ATO.
Subject to macro-economic trading conditions remaining stable, and no further significant COVID-19 national or state-wide government-mandated lockdowns, and after accounting for the repayment to the Australian Tax Office of $15.6 million, Premier confirmed it is confident in its ability to meet the current market consensus of FY21 EBIT of $318 million.