Spotlight leads clothing retailer Mosaic Brands fundraiser
The size of the convertible note issue highlights the pressure on Mosaic Brands, which has been particularly hard hit by the pandemic as its main customers are over 50, less likely to shop online, and have seen their income hit by record interest rates. .
Mosaic ended the year with cash of $ 57.8 million and borrowings of $ 26.4 million.
However, its 2021 accounts showed the retailer had a net current liability of $ 155.8 million and that the accounts were prepared on a going concern basis as directors believed the group would be able to pay its debts. when they expire, in part thanks to the raising of capital.
The fundraiser followed the release of Mosaic results on Tuesday night, which showed the owner of Noni B, Rivers, Millers, Rockmans and Katies returned to profit last year after collecting $ 94 million in JobKeeper payments. – of which $ 46 million went to profit – cut costs by $ 92 million and close 275 underperforming stores.
The retailer reported a net profit of $ 2.78 million, up from a net loss of $ 170.4 million the year before.
Underlying earnings before interest, taxes, depreciation and amortization reached $ 48 million, in line with recent forecasts, compared to an EBITDA loss of $ 46 million in 2020.
This follows an EBITDA of $ 45 million in mid-December, when the company received $ 83 million in wage subsidies from the Australian and New Zealand governments and failed to pay rent on closed stores.
As part of a “reset” program, the group cut costs by $ 92 million, of which $ 43 million came from the cost of doing business. She expects further material savings this year.
Mosaic also recorded an additional $ 6.8 million in restructuring costs and $ 22 million in brand and goodwill write-downs, following write-downs of $ 97 million in 2020.
Sales for the 12 months to June 27 fell 3.8% to $ 708.8 million – with a 19% increase in online sales partially offsetting store closures – after falling 16.5% in 2020.
Comparable store sales fell 8% during the year, but returned to growth in the June quarter as customers returned to stores.
However, closures in NSW, Victoria and ACT reduced sales in the first eight weeks of 2022, with same-store sales down 8% but online sales up 22%.
Despite the difficult start to 2022, chief executive Scott Evans said the group expected a profitable year.
“We remain confident that we are well positioned for growth once the country opens its doors,” said Mr. Evans.
“I have said over the past year that the combination of the bushfires and the pandemic has derailed our consistent growth streak… we think we are firmly back on track.”