Major Australian retailer that thrived during Covid collapses into voluntary receivership after mass layoffs
Booktopia has been placed under voluntary management.
The grim news for Australia’s largest online bookseller comes just weeks after the company announced it was cutting 50 jobs to save $6 million.
CEO David Nenke also stepped down in May, after holding the position for only 12 months.
In January last year, the company also laid off 40 people.
McGrathNicol restructuring partners Keith Crawford, Matthew Caddy and Damien Pasfield are conducting an emergency review of Booktopia’s operations.
They will explore options for sale or recapitalization.
The first meeting of creditors will take place on July 15.
“The administrators are conducting an urgent review of Booktopia’s operations whilst options for sale and/or recapitalisation are explored,” the statement released on the ASX said.
Australia’s largest online bookseller, Booktopia, has been placed into voluntary administration
‘The shares of Booktopia Group Limited (appointed administrators) will remain suspended from trading during the administration process. Shareholder updates will be uploaded to the ASX platform as required.’
Shares of Booktopia last traded at 4.5 cents, after peaking at $3.
The company’s CFO, Fiona Levens, left in May, just weeks before Mr Nenke.
Booktopia had its head office in Rhodes, in western Sydney, and a distribution centre in Strathfield South.
Booktopia is a popular online store during the coronavirus lockdowns. Australia Post.
Business News Australia reports that delivery delays, executive departures and a weak market all contributed to the company’s demise.
Competitor Amazon and stores like Kmart and Target also offer a range of discounted books.
At Booktopia’s peak, one book was sold every four seconds.
Booktopia sales soared during the Covid pandemic lockdowns as people were stuck at home and looking for something to do.
Revenue in the 2020-2021 fiscal year was $223.9 million, a revenue that rose again the following year to $240.8 million.
But revenues plummeted as lockdowns lifted and people cut back on spending due to rising interest rates, raising doubts about Booktopia’s future.
This is a breaking story. More to come.
