Cue Clothing and Veronika Maine collapse into voluntary administration with 51 stores and hundreds of jobs on the chopping block

Women’s clothing brand Cue Clothing Co has collapsed after failing to secure a buyer.

Employees across Australia and New Zealand were told on Tuesday afternoon the company had gone into voluntary administration and receivers were appointed.

Under receivership, one or more secured creditors attempts to recover debts by selling assets.

It differs from liquidation in that the company is still operational and there is a chance it could return to business once the assets are sold and debt is paid.

The company’s 51 stores, including 42 full-price shops and nine discount outlets, are set to remain open as the company begins its sale process. 

FTI Consulting’s Kate Warwick and Vaughan Strawbridge were appointed receivers and manager, the Courier Mail reported.

British assets investor Hilco Capital – which turns around struggling businesses – bought Cue Clothing from the Levis family in April last year after it turned an operating loss of $4.6million.

Rod Levis founded Cue in 1968 in Sydney and it remained in the family, alongside its sister brand Veronika Maine, until the sale to Hilco for an undisclosed amount.

FTI said in a statement that Cue Clothing’s improvements over the last financial year were ‘insufficient to mitigate the impact of overhead costs’.

‘The receivers are continuing to trade the business while they undertake an assessment of the business and restructuring options available,’ it said.

‘A sale process seeking offers for business as going concerns will also commence immediately seeking to secure the future of the brands, a pathway to profitability and ongoing employment for staff.’

Cue’s sales reached $103.2million in the last financial year, compared to $98million the year prior.

Its losses also dropped to $5.1million from $14.1million in the same period.

Hilco Capital had listed Cue Clothing for sale in August. 

More to come…