Jeanswest Australian parent company in administration, hundreds of jobs at risk

The parent company of transtasman clothing retailer Jeanswest has entered voluntary administration.

The parent company of transtasman clothing retailer Jeanswest has entered into voluntary administration, with hundreds of employees from over 90 locations across Australia set to lose their jobs.

But the New Zealand arm, Jeanswest Corporation (New Zealand), is not in administration. It has three New Zealand stores in Dunedin, Christchurch and Auckland’s Silverdale.

Lindsay Bainbridge, Andrew Yeo and David Vasudevan of Pitcher Partners Melbourne were today appointed to handle the administration of Harbour Guidance Pty.

A statement from the administrators confirmed the brick-and-mortar business operations are set to close in due course, but the brand and online store may continue, with all restructuring options remaining open.

Bainbridge said the company had fought for five years to revive the 53-year-old brand but had concluded it was time to step back from physical stores to focus on online retail.

“The owners have done everything they can to keep Jeanswest going, but market conditions mean sustaining bricks-and-mortar stores is not viable and unlikely to improve,” Bainbridge said.

“They deeply regret the impact of store closures on their team members and their customers and we will be working now with teams across the country.”

The business was saved from an earlier death back in 2020, when it was sold to Harbour Guidance Pty for an undisclosed figure.

Bainbridge acknowledged the impact on the hundreds of staff and was working with them to provide information on the next steps.

“We will be opening the doors of all stores and selling online to clear all stock to secure a return to creditors.”

New Zealand arm not in administration

Despite the effects on the Australian business, the company’s New Zealand operation is not in administration.

The most recent financial statements for the New Zealand company Jeanswest Corporation (New Zealand) were filed in February 2022.

They show that for the 18 months to June 26, 2021, the company made a loss of $303,117. The business had revenue of $9.59 million.

The financial accounts noted that due to its financial position, the company was dependent on receiving the continuing operational support of its ultimate parent entity.

“The company received a letter of operational support from its parent entity Harbour Guide Ltd that confirms the intention of the parent entity to provide operational support for a minimum of 12 months from the date of this financial report.”

At the time, the company said it was undertaking a programme of restructuring, which was expected to significantly reduce losses and improve cashflow.

“Whilst the directors are confident of receiving [the] ongoing financial support of Harbour Guide Ltd or its controlled entities and of improving financial performance, there remains a material uncertainty that may cast significant doubt on the company’s ability to continue as a going concern, which may result in the entity being unable to realise its assets and discharge its liabilities in the normal course of business.”

Harbour Guide Ltd is the ultimate owner of the company and is based in Hong Kong.

The New Zealand company’s shareholder is Harbour Guidance No. 1 Pty, which has an Australian address.

The Australian retail brand opened its first store in Perth, Western Australia in 1972, thanks to founder and denim king Alister Norwood.

Tom Raynel is a multimedia business journalist for the Herald, covering small business, retail and tourism.