Mosaic Brands subsidiary EziBuy has entered into administration.
Olvera Advisors chairperson Damien Mark Hodgkinson and principal Katherine Elizabeth Barnet have been appointed as administrators of the online fashion retailer.
The business will be restructured after a string of underperforming trading updates, including a 51% drop in total sales for the first half of the 2023 financial year.
Mosaic said it intends to propose a restructure to the administrator that would see EziBuy emerge as a “simplified, profitable, cash-generative online-only operation”, and one that is more aligned with the Group’s digital strategies across its other brands.
Mosaic stated that the performance of EziBuy has been at odds with the strong and continued digital growth across Mosaic’s omnichannel brands.
Online sales for the Group (excluding EziBuy) account for 23% percent of revenue and are up 68% against pre-pandemic levels.
EziBuy, which has no stores in Australia, was acquired shortly before the pandemic as part of Mosaic’s online strategy. The group said was profitable in FY21 and FY22.
However, in-line with other predominantly online brands, the return to instore shopping post-pandemic lockdowns impacted EziBuy, with total sales in the first half of FY23 down 51% compared to the prior corresponding period.
The extent of EziBuy’s sales decline, particularly in the context of the Group’s wider positive portfolio of online performance, prompted the Board to conduct a Strategic Review of its operating and cost structure, which led to today’s announcement.
The Board believes this process to restructure EziBuy is in the best interests of the Group’s shareholders as it will improve the Group’s overall net asset position and operating cashflow.
Mosaic said the announcement has no impact on any other of the nine retail brands within the Group’s portfolio.