Postie Plus Group [NZX: PPG], whose stock has dropped 42 percent in the past 12 months, has met an extended deadline to post its first-half results, reporting a wider loss on supply chain disruptions and tough trading conditions for clothing retailers.
The net loss was $3.8 million in the six months ended Feb. 2, from a loss of $1.8 million a year earlier, the Auckland-based company said in a statement. Sales fell to $39 million from $43.3 million.
Postie Plus had until today to file its results or have its shares suspended by NZX regulators after missing the official April 1 deadline. The company is currently in breach of its lending covenants and expects to remain so "for the foreseeable future," meaning its bank funding is repayable on demand.
The funding remains available and the company is in regular contact with its bank, it said today. Bank debt fell to $12.1 million at Feb. 28, from $18.2 million at balance date, after it sold its SchoolTex brand to Warehouse Group for $9 million.
The board "is satisfied that the arrangements it has in place with its bank are sufficient to meet the company's forecast funding requirements up to 30 July," it said. The company is working on recapitalising its business ahead of a forecast funding requirement peak of about $19 million between July 30 and Feb. 2 next year.
Postie Plus said it expects to be able to negotiate new bank facilities for the period beyond July 30 "if the company is able to meet its trading forecasts and secure additional funding to reduce its reliance on bank funding," it said.
"Despite improvements in the broader economy, trading remains very tough as demonstrated by recent results," the company said. "As a result, PPGL expects to make a significant net loss before tax for the year to 3 August 2014 albeit deliver an improvement over last year's $10.6 million loss," it said.
The company was hit by supply chain disruptions in the summer of 2012 and 2013 after outsourcing its distribution centre. It has subsequently terminated that relationship and expects to have a new provider in place by July 31, chief executive Richard Binns said.
The stock last traded at 9.5 cents and has fallen from 16.5 cents a year ago.