Lisa Ho’s label on the rocks after failed public float.
After last month’s failed attempt to list on the ASX, the iconic Australian designer brand has appointed HLB Mann Judd as administrators, reports Smart Company.
The IPO planned to offer 7.5 million shares priced at $0.20 each to raise a minimum of $1.5 million, according to the article.
The business recorded $13.05 million in revenue in 2012 but made a loss of $2.3 million, which the brand attributed to “one-off issues”.
Chief executive of the Retail Doctor Group, Brain Walker told SmartCompany a public float is often seen by retailers as an excellent way to “almost cheat the grave”.
“It’s quite often one of the last calls to prop up an organisation that is clearly struggling,” Walker says.
Administration is not the end for Lisa Ho as a business and could potentially lead to a ‘rebirth’, says Walker.
“In the rag trade when these things happen, there are many cases when the business trades on, it is actually the tax office, creditors and suppliers that take the hit,” he says.
With many designer labels including Charlie Brown, Bettina Liano, Tsubi, and sass and bide who have experienced similar situations, have been rid off their debts and tax obligations thanks
To a voluntary administrator and come through the other side better off.
Walker says Lisa Ho’s operating loss of $2.3 million looks to be a result of strategic supply chain issues.
“It shows you really need to buy well, be on trend and not overinvest in working capital,” he says.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.