Postie Plus[NZX: PPG], whose shares have plunged 44 percent over the past 12 months, expects to narrow its annual loss as it tries to revive profitability.
The retailer expects to have a "significant" net loss before tax in the year ending Aug. 3, though smaller than last year's loss of $10.6 million, the Auckland-based company said in a statement. The forecast came as the company said sales fell 9.9 percent to $39 million in the six months ended Feb. 3 while gross margins improved.
Postie Plus has struggled to deal with the poorly executed outsourcing of a purpose-built distribution centre in Mangere when it relocated to Auckland in 2012, where it saw greater opportunities. The disruption to its supply chain put the operation under pressure, leaving it with too much debt and limited cash flow.
"The 'profit improvement plan' set in motion at the start of last year continues to deliver against our targets and we are confident it will continue to do so," chief executive Richard Binns said. "We are now reviewing sales by category and removing non-performing items."
The first-half period doesn't capture the retailer's sale of its SchoolTex school uniform brand, which was bought by Warehouse Group for $9 million. Postie Plus will use the cash to repay debt, and has been given space by its lenders until July 2014 with an extension of its credit facilities.
The shares were unchanged at 9 cents today, and have dropped 22 percent this year. That values the retailer at $3.6 million.
Postie Plus will report its first-half result by April 1.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Light rail the winner in latest Auckland Transport turnaround
- Auckland council puts debt issuing plans on ice over Brexit concerns
- Brexit aftermath: disdain, the elites, and the warning for conservative parties everywhere
- Companies Office rejects NZ First complaint over Silver Fern deal
- Will people voluntarily stop owning cars within 20 or 30 years?
Most listened to
- BNZ's Jason Wong says the movements in the currency market last week were some of the biggest in history
- CBL's Peter Harris on uncertain times in the UK insurance industry
- Govt performing an awkward political U-turn on foreign trusts. Rob Hosking with John Shewan and John Key
- Trade Minister Todd McClay says plans for an FTA with the EU will not be hindered by the Brexit
- Oxford University academic Malcolm McCulloch predicts the imminent death of the internal combustion engine