Topshop operator’s losses detailed

Topshop-QVBTop Retail, which operated the local Topshop and Topman stores, was in negative equity after generating $4.1 million of losses in its three-year life in New Zealand.

The first receivers’ report by McGrathNichol’s Conor McElhinney and Kare Johnstone show the retailer in negative equity of $2.9 million as at September 7, the date of receivership, after accumulated losses since its launch in 2014 outstripped the $1.3m of shareholder funds.

The shareholders of the retailer included interests associated with Kiwi clothing firm Barkers, Christchurch property investor Philip Carter and fashion designer Karen Walker and also extended loans totalling $6.1m to Top Retail.

The company’s stores on the high streets of Auckland and Wellington were closed in September after the receivers failed to find a buyer, leaving net debt owed to the appointing lender of $2m, the shareholder loans and some $1.8m to trade creditors.

The receivership was the latest in a line of retailers struggling to make a traditional bricks-and-mortar model work when online rivals avoid the overhead of a high street site and are accused of skirting customs duties that traditional vendors face.

Top Retail’s assets were valued at $8.1m, of which $5.9m was in furniture and fittings. The company had inventories totalling $787,000 at the time of receivership, and managed to sell all stock before the stores were closed, the receivers said.

Staff were owed $95,000 of unpaid wages and holiday pay when the receivers were appointed, and Inland Revenue Department was owed $55,000 of outstanding income tax and a further $1400 in GST.

In Australia, Topshop and Topman have been salvaged with Sir Philip Green and his UK-based Arcadia Group stepping in to take over the business.

Comments

Comment Manually

Yop Polls

Easter trading
Should retailers be allowed to open on Easter Sunday?

Twitter

Sports retailer saw profits jump 17 per cent to NZ$189 million for the half. https://t.co/OMfeD8NJB0

4 days ago

Food and beverage, fashion and beauty retailers expanding through the region. https://t.co/ZDUsqaCOG5

4 days ago

If brands can tackle the barriers to customisation then it could have a future. https://t.co/y6e7n6hI3k

5 days ago
x

SUBSCRIBE
FREE NEWS BRIEFS Get breaking news delivered