Popular fashion labels Noni B, Katies, Rockmans and Rivers will soon be re-opening their retail stores with parent company Mosaic Brands (ASX: MOZ) confirming they will undergo a progressive restart after closing their 1,400 stores in March due to coronavirus biosecurity.
Despite its store network’s closure over the past six weeks, Mosaic’s focus towards online sales during the period was highly successful, delivering an 80% increase in online sales compared to the equivalent period in the prior year.
The COVID-19 enforced strategy shift enabled Mosaic to expedite their digital strategy to emphasise each of their brand’s unique customer propositions and acquire new customers for their digital platforms.
Having undertaken trial re-openings of stores over the past week, Mosaic will now expand to a progressive re-opening of the wider network starting from 11 May 2020, with each store to adopt strict safety protocols in line with Government directives.
By doing so following their trial re-openings, Mosaic has logged customer foot traffic data, shopping habits and revenues as a measure for discussion with landlords regarding rent during the progressive re-openings. Individual stores however, will only be reopened where Mosaic can reach satisfactory commercial terms with landlords.
Despite the surge in their online sales, Mosaic has forewarned that the Company is expected to report an EBITDA loss for FY20 with H2 forecasted to negate the H1 EBITDA of $32.7 million.
To mitigate operational expenditure through H2, Mosaic has applied for the Government Jobkeeper program and expects a return to profit in FY21.
News of the store reopenings and online sales growth was well received by investors with MOZ shares trading at $0.73 upon market open, a rise of 27% on the previous day’s close of $0.57.
Mosaic Brands Ltd operates fashion labels Millers, Rockmans, Noni B, Katies, Rivers, Autography, W Lane, Crossroads and Beme.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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