Myer chief executive Richard Umbers says the first year of the company's five-year turnaround plan, which includes a focus on high-profile brands, has delivered improvements.
The department store chain's $600 million transformation involves giving more space to popular brands, such as TOPSHOP, Industrie and Mimco, while cutting back its own private labels.
Myer is also reducing its store footprint by closing stores and decreasing the size of others by handing back floor space to landlords.
Both strategies are a contrast to the approach taken by its more successful rival David Jones, where parent company, South African retailer Woolworths, is increasing its own clothing labels and is opening more stores.
Mr Umbers says Myer is a stronger business than it was a year ago after unveiling the group's 2015/16 results on Thursday.
"We are very pleased with the results which show the strategy we have embarked upon is the right one," he said.
"We will continue to invest heavily in premium flagship stores and refurbishments."
Myer will also introduce SABA, Oroton and UK department store John Lewis homewares to stores in the current financial year as a continuation of its focus on "wanted" brands.
The retailer's sales rose 2.9 per cent to $3.3 billion in the 12 months to July 30, partly boosted by an extra week of trade, with comparable sales up three per cent.
On a 52-week period, total sales were up by 1.6 per cent which is lower growth than the 1.7 per cent in the prior year.
Net profit more than doubled to $60.5 million, because of hefty restructuring costs in the prior year but underlying net profit was down 10.63 per cent to $69.3 million, in line with company guidance.
The results failed to impress investors who drove the company's share price down two cents, or 1.54 per cent, to $1.275.
Forager Funds senior equities analyst Daniel Mueller said investors were not convinced that the strategy was working.
"It wasn't a result that gave enough indication that their five-year target can be hit," he said.
"Gross margins were down quite a bit. It looks like there is quite a bit of work ahead of them."
Mr Mueller said Myer's focus on concession brands rather than house brands was weighing on its profit margins.
Myer wants to hit an annual sales growth of more than three per cent in five years and to lift earnings at a faster rate than sales.
It says it will close its Logan, Queensland, store in the 2018 financial year and will drop plans to open one in Darwin.
This follows an announcement in May that it will close three stores in Queensland and New South Wales and earlier announcements to abandon new stores in those states.
MYER SAYS ITS ON THE RIGHT TRACK:
* FY16 net profit $60.5m, up from $29.8m in FY15
* Total sales 3.3b, up 2.9 pct
* Final fully franked dividend of 3.0 cents.
