By Padraig Collins For Daily Mail Australia
03:18 19 Jun 2024, updated 03:32 19 Jun 2024
A huge Australian retailer has halted share trading before an announcement that is expected to bring stark news about the future of the company.
Online seller Booktopia asked the Australian Securities Exchange (ASX) on Monday to pause trading due to a ‘pending’ update to shareholders.
‘The suspension is requested from the date of this letter until the commencement of trade on Friday 21 June 2024,’ Booktopia’s general counsel wrote to the ASX.
‘Further announcements will be made in due course,’ a Booktopia spokesman told Daily Mail Australia.
The grim news for Australia’s largest online bookseller came just two weeks after it axed 50 jobs and lost its chief executive, which followed the 40 people Booktopia made redundant in January 2023.
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The coming update will concern the company’s strategic review that began in February, after revenue dropped by 21 per cent.
Its revenue fell to $86.3million in the second half of 2023, which led to a net loss of $16.7million, with net liabilities of more than $20million.
In February, the company said it had reduced its sales expectations by between $1m and $3m based on market conditions, citing BookScan figures showing an 8.3 per cent decline in book sales in January.
Earlier this month, Booktopia’s share price hit a low of 4.5c a share, a drop of 98 per cent.
CEO David Nenke resigned in June after less than a year in the job, with company co-founder and its former chief executive Tony Nash replacing him.
Booktopia’s chief financial officer and other senior executives also resigned in recent months, and its chief marketing officer left last year.
‘With this decline in revenue and with the organisational restructure about to be implemented, the company is no longer in a position to provide guidance and withdraws the guidance provided to the market in its announcement made on 9 February 2024,’ the company said in a statement on the ASX.
Booktopia’s sales surged during the Covid-19 pandemic lockdowns, with people stuck at home and looking for something to occupy their time.
Its turnover in the 2020-2021 financial year was $223.9million, and then went up again to $240.8million the following year.
But its revenue fell drastically as the lockdowns ended and people cut their spending as interest rates rose, raising doubts about Booktopia’s future.