Shares in Pacific Brands have dived by more than five per cent after the troubled clothing maker unveiled a blowout in full-year losses and announced its boss will leave.
Pacific Brands on Wednesday reported a $450.7 million loss for 2011/12, compared to a $131.9 million deficit for the previous year.
It also announced the departure of chief executive Sue Morphet, who will step down on September 3 after five years in the role.
Shares in the company dived by 5.9 per cent in early trade and were 2.5 cents, or 4.2 per cent, weaker at 56.5 cents at 1049 AEST.
Ms Morphet will be replaced by former Foster’s boss John Pollaers, whose fixed annual remuneration for the first year will be $1.4 million plus incentives.
Ms Morphet has headed a major restructure of the company, whose brands include Bonds and Sheridan, and tried to reduce its debts.
“I am a firm believer that five years is just about the right length of tenure for a CEO,” she said in a statement.
“It’s time for a fresh set of eyes and new energy to take this great company forward.”
Her replacement, Mr Pollaers, said he was looking forward to building on the areas of momentum already in the business.
“I feel certain there are further opportunities for growth within the Pacific Brands portfolio and I look forward to tapping into the possibilities for this business,” he said.
Unveiling its financial results, the company said market conditions were expected to remain challenging in fiscal 2013.
Gross margins were expected to be maintained in line with 2011/12, with import costs stabilising and currency exchange rates largely hedged at competitive rates.
“Year-to-date underlying sales performance has been mixed with underwear up, workwear down, HFO (homewares, footwear and outerwear) down and the overall group marginally down,” the company said in a statement.
The company blamed the net loss blowout on $502.7 million in non-cash writedowns of goodwill on its underwear, homewares and workwear divisions.
There were also $31.4 million in restructuring costs.
Sales revenues fell to $1.3 billion from $1.6 billion.
“Earnings outcomes will be largely dependent upon market conditions and associated sales performance, and may be impacted by ongoing restructuring and rationalisation,” it said.
“The company remains well-placed to deal with the current trading environment and to benefit from any improvement in market conditions.”
Pacific Brands said its Bonds and Sheridan brands were showing resilience in a difficult market, while the workwear business had been hurt by lower business confidence, a slowdown in the resources sector and reduced government spending.
The company declared a fully-franked final dividend of 2.5 cents a share.
