Clive Peeters is still open to offers with the Company determined to cut their bank debt. The claim was made after the Company announced losses of $11.3 million and a decline in sales of 7%.
Clive Peeters is still open to offers with the Company determined to cut their bank debt. The claim was made after the Company announced losses of $11.3 million and a decline in sales of 7%.
Late last year in an effort to raise cash the Company called in KPMG in an effort to attract an investor.
Despite a nine month search the Company who last month discovered that a former Payroll Manager had stolen over $19 million dollars was unable to attract any interested parties.
CEO Greg Smith said “Regarding the Strategic Review process which the Board announced in November 2008, we received several incomplete and conditional proposals from interested parties, some of which were industry participants. It was the opinion of the Board that the Strategic Review did not provide a suitable outcome that was in the best interests of shareholders, so it was discontinued in May of this year”. The Company indicated it will remain open to a re-capitalisation of the business.
Smith added “In June 2009 the Bank renewed Clive Peeters’ short term facility for a further 13 months until 31st July 2010. Our non current facility is in place until June 2011. It is our intention to make significant inroads into our Bank debt over FY 2010, and the additional cash we are recovering from the cash misappropriations will provide even more scope for debt reductions. Our intention is to bring Clive Peeters’ net gearing down to conservative levels by 30 June 2010.”
The Company announced it will not declare a final dividend for FY 2009 in the interests of preserving capital in the challenging retail environment.
Smith gave a forecast of conditions ahead for the retailer.
· Clive Peeters expects the challenging conditions for the big ticket retail discretionary sector to continue, but acknowledges that signs are emerging that the cycle is improving.
· The Company expects to make a substantial recovery of monies in FY 2010 from the misappropriation of cash during FY 2008, FY 2009, and July 2009.
· The recovery will lead to a strengthened Balance Sheet and cash reserves over time. The properties will be sold down in an orderly manner, and should improve the Company’s trading outlook.
· Over FY 2010 the Company will benefit from the implementation of annualised cost cuts already in place, approximately $38.0m.
· The Company will maintain tight control over capital. No new stores are planned to open in FY 2010.
· The launch of Clive Peeters’ on line business on 28 August 2009 will provide further sales stimulus, albeit not material in FY 2010, and will drive stronger customer traffic into stores.
· FY 2010 will be a year of consolidation for Clive Peeters, before store rollout resumes as the business cycle improves.
