After trial openings over the past week and an 80 per cent jump in online sales, a group that owns some of the biggest names in Australian fashion retail will start progressively reopening stores on Monday, 11 May.
As the owner of Rockmans, Noni B, Millers, Rivers, Katies, Autograph, W.Lane, Crossroads and Beme, Mosaic Brands (ASX: MOZ) shut almost 1,400 stores in March as a response to social distancing recommendations.
Despite recording a positive EBITDA of $32 million in the first half, Mosaic is forecasting an overall EBITDA loss for FY20, as reopenings and an anticipated gradual recovery in customer demand will be unlikely to offset the impacts of the coronavirus-induced decline in foot traffic and store closures.
"However, management anticipates the pandemic's impact on its performance to be short-term and expects a return to profit in FY2021," Mosaic said.
"The Board will not declare an interim dividend for the half year to 29 December 2019 following its earlier deferral, which was pending clarification of the impact of COVID-19.
"The Company is very supportive of the Government's JobKeeper program, which has allowed it to retain its store and support office team members, and recognises the support of ANZ in facilitating Mosaic's access to the program and assisting it to navigate through this period."
The company notes valuable insights into changing customer shopping habits have been gained from the trial openings, although it did not state which fashion stores specifically had ben trialled.
Mosaic is providing these insights to landlords in a bid to renegotiate rental terms in keeping with the Government's mandatory code of conduct for commercial leasing arrangements.
The group emphasises stores will only be reopened where satisfactory commercial terms are agreed with the landlord.
"Mosaic is committed to working with its landlords to resume normal trading as soon as it is viable to do so and to provide a safe and improved shopping experience for customers," the company said.
An 80 per cent year-on-year jump for online sales for the past six weeks has been attributed to the strength of Mosaic's nine brands and increased investment in its digital strategy.
"This performance reflects substantial work during this challenging time to accelerate the company's strategy to expand the range of products offered and grow customer acquisition," Mosaic Brands said.
"Twenty categories and over 100,000 SKUs, reflecting each brand's unique customer proposition, have been added during this period to the company's websites."
Updated at 9:37am AEST on 7 May 2020.
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