Australia is the company’s largest market, accounting for 55 per cent of revenue.
In a statement, the company said, “Given the escalation of this pandemic in the last day and direction from the state and federal governments, it is with a heavy heart that we have taken the decision to close all Michael Hill Australian stores on Monday 23 March, until further notice. We will of course endeavour to keep you fully informed on any future changes during this time and will re-open as soon as we are given approval by government health authorities.”
The company noted a significant “drop off in trade” in Australia prior to the store closures, which it said reflected “a customer base that is, of course, focused on more immediate issues”.
Michael Hill International’s New Zealand and Canadian stores have also been closed indefinitely as the pandemic escalates worldwide. Its online stores will continue to operate; e-commerce accounts for 3 per cent of total revenue.
Emma Hill, chair Michael Hill International board of directors, said, “The board and management team have acted swiftly today following the extraordinary circumstances that are impacting the Australian and New Zealand retail markets.
“Whilst it is clear that the suspension of our store networks is necessary for the safety and wellbeing of our people and our customers, we know also that this will be a time of great uncertainty for them too, and we are doing our best to provide them with the support that they need through this difficult time.”
The company confirmed that staff would be ‘stood down’ with full leave entitlements and its head office in Brisbane would also be reviewed “with a view to reducing costs”. It has approximately 2,500 permanent employees across retail, administration and manufacturing.
Daniel Bracken, CEO Michael Hill International, said the company would take “all necessary actions to reduce our costs and cash outflows so that they better match the very subdued consumer demand in all our markets”.
Michael Hill International’s share price fell more than 20 per cent on Monday 23 March. It has deferred payment of dividends for six months.
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