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Home / australia / Gloria Jeans, the owner of Donut King falls red and with losses for $ 111 million

Gloria Jeans, the owner of Donut King falls red and with losses for $ 111 million


There were less new franchisees registering and fewer store owners renovating, what he said was due to the "prevailing negative feeling" against the franchising industry.

RFG has been in financial trouble since an investigation has been carried out by Age e O Sydney Morning Herald He revealed that many of his brands were fighting and that his strong business model meant that many franchisees strived to survive.

RFG revealed a value of $ 79 million in cash not worth the value of its brands and commercial funds, and took another $ 45 million in provisions on real estate and equipment, inventory, commercial debtors and leases and onerous contracts.

Revenues collapsed even without declines, with an underlying net profit after tax dropping to $ 6.6 million from $ 24 million a year ago.

RFG chief executive Peter George said the results showed that the company was "clearing the roofs" and stabilizing the company.

"Although there is a lot to do to resuscitate the financial health and performance of the business," he said.

George said the company would undertake a unit of cost reduction by firing "surpluses and duplicate full-time papers" and selling assets to deliver an annual cost savings of $ 20 million.

Bankers from the group, NAB and Westpac, gave the company a suspension of execution rejecting the evidence of their debt pacts for the period ending on December 31. Banks also renounced the agreements in September and June last year.

RFG said that its $ 259 million debt was subject to a "sometime" review process and that it was looking for ways to pay the facility by selling Donut King, Crust and Pizza Capers.

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