* Myer H1 net loss A$476.2 mln vs A$62.8 mln net profit prior year
* Result includes A$513 mln impairment charge
* Company suspends dividend (Recasts throughout, adds share performance & context)
By Byron Kaye
SYDNEY, March 21 (Reuters) - Top Australian department store chain Myer Holdings Ltd slumped to its biggest half-yearly loss since listing as it wrote off the value of its underperforming assets, conceding flawed execution of its strategy and an inadequate response to online competition.
The result may provide ammunition for Myer's biggest shareholder, billionaire retail investor Solomon Lew, who has been using his 10.7 percent stake to lobby smaller shareholders for support as he seeks to remove Myer's entire board.
The loss, which was flagged a month earlier, also underscored the urgency for the 118-year-old retailer to convince investors it can flourish next to the likes of Amazon.com Inc and cheap brick-and-mortar fashion chains.
The company's A$476.2 million ($366 million) net loss for the six months to Jan. 27 compared with a A$62.8 million net profit for the same period a year earlier, and prompted the Sydney-based firm to suspend its dividend.
"The results of the first half year were unsatisfactory and reflect a number of execution issues, including an appropriate response to aggressive competition prior to Christmas," Executive Chairman Garry Hounsell said on a call with analysts.
Hounsell took the executive role when Chief Executive Officer Richard Umbers left the company unexpectedly a month ago. Amazon's Australian arm began taking orders in December, Myer's most important trading period in the lead-up to Christmas.
Lew has been critical of Hounsell, who has assumed responsibility for a 5-year turnaround plan, though his move to oust the board would need support from more than 50 percent of shareholders. Neither Lew nor Myer's second biggest shareholder, fund manager Investors Mutual Ltd, were available for comment.
STRUGGLE NOT OVER?
Myer had until now rolled out a strategy of targeting "high value" customers too quickly but would stick by its existing plan to minimise floorspace, cut rents and build up its online presence, Hounsell said.
Online sales grew 49 percent in the six months to $105.2 million, he noted, although that was a fraction of its total sales, which fell 3.6 percent to A$1.7 billion. Same store sales also declined 3 percent.
Myer shares were up 2 percent at 44 Australian cents in midsession, still near the record lows they have traded at in recent months following three profit downgrades. The shares were issued at A$4.10 in 2009 and have never traded above that level.