(Adds background on Australia's economy, details)
Sept 5 (Reuters) - Australian department store operator Myer Holdings Ltd MYR.AX swung back to an annual profit on Thursday, supported by its turnaround strategy that has seen costs cut and low-margin brands let go.
Profit for the 119-year-old firm was A$24.5 million ($16.55 million) for the year ended July 27, compared with a loss of A$486 million a year earlier. The result missed a forecast of A$31.8 million profit, according to Refinitiv data.
In the year since John King took over as Myer's chief executive, he has overseen an overhaul of the department store by cutting jobs, the size of its stores and shifting focus towards high-margin brands.
While the second half was forecast to be bumpier amid soft consumer spending as Australia's economy grows at its slowest pace in a decade, the series of changes helped Myer return to profitability in the first half of the year. sales dropped 3.5% to A$2.99 billion, as it flagged weak consumer sentiment in the 2020 financial year.
"We anticipate the challenging macro environment and subdued consumer sentiment to continue during FY2020," said King.
Online sales rose 25.6%, supporting Myer's push to beef up online store offerings as more customers move away from brick-and-mortar stores.
($1 = 1.4806 Australian dollars)