Postie Plus mulls capital-raising, debt cut as sales disappoint
Postie Plus Group, the retailer that breached bank covenants earlier this year, said it is mulling ways to raise capital to repay debt in the face of continued disappointing sales.
"July sales were below expectations due to difficult trading conditions," the company says in a statement from chairman Richard Punter. "This has compounded the previously reported impact on sales due to difficulties with stock distribution.
"Due to these factors PPGL is exploring options to raise capital for the purpose of improving the company's working capital position and reducing debt," he says. "The board is considering a number of options but has not yet decided the structure of, or the amount to be raised, by a potential capital raising."
The retailer yesterday named No 1 Shoes executive Richard Binns as its new chief executive. He will take over a company that has burned through cash in the face of tough retail market conditions and disruptions from its decision to outsource its distribution centre.
The shares last traded at 15.5 cents and have tumbled 35 percent this year.