Tuesday 3rd June 2014
|Text too small?|
Postie Plus, the worst performing stock on the New Zealand stock market, has appointed administrators after its lenders withdrew support as the company continued to make ongoing losses.
The Auckland-based retailer appointed David Bridgman and Colin McCloy of PwC as administrators, saying attempts to recapitalise the business had been unsuccessful. The retailer's board also sought to sell the business outright, or find a new cornerstone shareholder. The administration should allow Postie Plus to keep trading so it can be sold as a going concern.
"Despite restructuring, optimising of the existing DC (distribution centre),and recent improvements to gross margin and market share, the company has continued to make ongoing trading losses," the company said in a statement. "The company's bank has been supportive through this period, but has decided it cannot extend its facilities further to cover ongoing losses."
In April, Postie Plus said it was in breach of its lending covenants and expected to remain so “for the foreseeable future,” meaning its bank funding is repayable on demand, though the arrangements it had in place with its bank were sufficient to meet the company’s forecast funding requirements up to July 30.
The company was hit by supply chain disruptions in the summer of 2012 and 2013 after outsourcing its distribution centre to a third party, while shifting its headquarters to Auckland, where it anticipated growth. After receiving legal advice, Postie Plus said it intends to "vigorously" pursue a damages claim.
The shares were halted on Thursday at 7.3 cents, valuing the company at $2.9 million. The shares have,slumped 72 percent since the start of 2012.
No comments yet
12th November 2019 Morning Report
MARKET CLOSE: NZ shares gain, retirement villages buoyed by Auckland housing market bounce
NZ dollar rises, shrugging off US-China trade war woes
Long-serving ACC investment chief calls it a day
Institutional investors continue to shun Fonterra
Card spending stalls; dearer petrol crowds out other goods
Abano directors cave to takeover by scheme of arrangement
Fletcher dismisses subcontractor claims as vague
11th November 2019 Morning Report
Odds favour a rate cut but it's a line ball call