Rivers drags Katies owner Specialty Fashion down for a second year of losses

City Chic caters for sizes 14 plus. Lisa Maree Williams/Getty Images

Specialty Fashion, the owner of Katies and City Chic stores, posted its second year of losses, dragged down by its purchase of Rivers stores.

A short time ago, its shares were down more than 15% to $0.595.

Full year revenue was up 4.4% to $826.24 million and the loss $2.19 million, a 50% improvement on last year’s $4.46 million red number.

The company held back on declaring a dividend.

The loss attributable to Rivers halved to $9.9 million from $21.6 million the year before.

CEO Gary Perlstein says Rivers is expected to start trading profitably during the 2017 financial year.

“The Rivers turnaround is on track, and the worst is well behind us,” he says.

“The Rivers leadership team is delivering strong improvement across the business.

“Improved product is resonating with consumers across all categories. Cost-effective online marketing is also making a real difference in building customer loyalty, with a big uplift in online sales and repeat purchases.”

The Rivers stores, a warehouse-style clothing retailer, has been a drag on results since Specialty Fashion bought the business in 2013.

Specialty Fashion says it is the largest specialty retailer of women’s fashion in Australasia through Millers, Katies, Crossroads, Autograph, City Chic and Rivers. It has 1,078 stores in Australia, New Zealand, the US and South Africa.

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