The US clothing brand Gap is closing in Australia.
The luxury brand retailer OrotonGroup, which has the Gap franchise in Australia, says it will discontinue the business locally, with the six stores closing by the end of January 2018.
A short time go, its shares fell 4.7% to $1.00.
OrotonGroup, hit by weak retail demand, has been conducting a strategic review of its business.
Ross Lane, CEO of OrotonGroup, says the closure of the Gap franchise stores will allow more focus on the strategy for the core Oroton brand.
In the last trading update, the company said soft trading conditions resulted in a disappointing mid-season sale in April.
In April, Mark Newman stepped down after four years as CEO. Ross Lane, a director and major shareholder, is acting CEO.
Clothing retailers in Australia have been under pressure from emerging competitors online and general market conditions.
In February, fashion labels Marcs and David Lawrence went in to voluntary administration, the latest in a string of players going into administration, including Payless Shoes, Pumkin Patch, Howards Storage World and Dick Smith stores, which closed last year.
OrotonGroup’s half-year results announced in March showed revenue down 10% to $67.1 million and net profit falling 52% to $1.8 million.
The company is forecasting underlying EBITDA (earnings before interest, taxes, depreciation, and amortisation) of $2 million to $3 million for the full year, a fall of up to $10 million.
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