Struggling women’s fashion retailer Mosaic Brands (ASX:MOZ) is hacking into its business to try and stay alive.
The company will exit five brands and close more than 200 stores as it struggles to get its shares listed back on the ASX after they were suspended because the company didn’t lodge them in time.
The company says that it is working to get the accounts finalised and lodged with the ASX.
"The delay is due to events after the reporting period, which will impact the disclosures accompanying the audited results,” the company revealed in its latest statement to the ASX this week.
Mosaic says it will close its Rockmans, Autograph, Crossroads, W.Lane and BeMe brands, including all stores and websites. It is unclear how many jobs will be affected at this stage.
The brands Rockmans, Autograph and W.Lane had more than 200 stores across Australia in 2023, but the number could be smaller given that the company has been cost-cutting for more than a year with numerous store closures.
Mosaic CEO Erica Berchtold said the group would cut its brand portfolio to drive simplification across the business and focusing resources.
“Mosaic will wind down five brands which have become marginal and non-core, allowing us to focus on five core growth brands,” she said in a statement lodged with the ASX.
“Each of those core brands will have a clearly differentiated market proposition, target customer, price point and product range.”
The brands it will focus on will be Millers, Noni B, Rivers and Katies, along with a stand-alone online Mosaic marketplace.
“Whilst the operational details of the rationalisation plan, including store closures, continue to be worked through, we will seek to minimise the impact on our team, including where possible reassigning impacted team members into roles within the five core brands,” added Ms Berchtold
Mosaic went into a trading halt in August and announced that it had engaged accounting firm Deloittes to advise on refinancing operations.
Holders of convertible notes issued by the company (and listed on the ASX) this week agreed to some significant changes to their terms to extend their life until March 2026.
In a note explaining the move, the company admitted that it didn’t have the funds to redeem the notes on which interest has been capitalised for some time. More than $18 million is owed. It also said it doubted it could raise the funds via a capital raising.
Because the shares could not be converted by September 30 (Monday), full repayment (including interest) would have had to happen. Monday’s meeting agreed to change the terms to extend the notes for another 18 months, with an interest rate of 12%.
