Strapped Oroton deciding whether to bag a sale
STRUGGLING luxury handbag retailer Oroton has flagged it could be up for sale as it explores options to overcome falling sales and a precarious debt position.
The possible sale is one option to emerge from a review undertaken in May.
“Numerous parties have expressed interest in exploring certain strategic options, which may involve a sale, refinancing of debt facilities or recapitalisation of the company,” Oroton said yesterday. Its shares surged 4.4 per cent or 4.5¢ to $1.08 yesterday.
The company has also revealed it could receive up to $3 million in credit support from former director Will Vicars, a fund manager who holds an 18.2 per cent stake on Oroton.
The retailer said yesterday that market conditions remain “very competitive and challenging”. It expects underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to fall to between $2 million and $3 million this financial year, down from $12.9 million. Sales revenue dropped 11 per cent in the nine months to April 30.