Australian Fashion Group calls in administrators in last ditch bid for survival
The fashion company behind brands including Keepsake, The Fifth Label and Finders Keepers is in administration for the second time in less than five years.
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The future of an Australian fashion house acquired from administrators less than five years ago is in limbo again, with one company in the group slipping back into administration and three others entering payment plans with creditors in a desperate bid to remain afloat.
A consortium of investors calling themselves International Fashion Labels took over Adelaide-based Australian Fashion Labels in 2021, before rebranding the company as Australian Fashion Group and re-launching its four brands – Keepsake, The Fifth Label, Finders Keepers and C/MEO Collective – as well as the BNKR online store.
Administrators were called in to take control of International Fashion Labels by its director Toby Yap last week, following an earlier winding up application filed by the Australian Taxation Office.
It comes after three other companies in the International Fashion Labels group entered payment plans with creditors late last year as part of a debt restructure.
Fashion Bunker Online, International Fashion Labels (Design) and International Fashion Labels (Admin) each entered payment plans promising to return creditors a little over 12c in the dollar owed.
According to documents filed by restructuring practitioner David Trim from Hall Chadwick at the time, the companies’ director, Mr Yap, blamed the group’s financial difficulties on a number of factors including “economic volatility and inflation” and the impact of Covid-19 which caused factory closures, delivery delays and the cancellation of orders in Australia and the US.
A “significant overspend” on IT systems and infrastructure by previous management and rising costs were also listed as factors behind the financial issues.
It is understood some parts of the International Fashion Labels group, including the BNKR platform, are continuing to trade at a limited capacity as Mr Trim, the administrator of International Fashion Labels, works with Mr Yap on a potential rescue plan.
The BNKR website is currently displaying C/MEO Collective womenswear, but no products from the three other Australian Fashion Group brands.
“We are gathering information on the company and its activities and working closely with all stakeholders,” Mr Trim said.
“We will be reporting to creditors our opinion on the future direction of the company, including any proposals for a deed of company arrangement as soon as possible.”
Mr Yap did not return calls from The Advertiser.
At its peak, Australian Fashion Labels generated annual sales of more than $50m, employed more than 100 people in Australia and overseas and ran a flagship bricks and mortar store in Rundle Mall before the company’s $12m collapse during the height of Covid-19.