Dick Smith’s priority creditors are facing a loss of almost $100 million in New Zealand, according to early indications from the company’s first receivers’ report.
Filed to the Companies Office in New Zealand, the first analysis of the Kiwi business estimates a net loss approaching $100 million, before the costs of selling the company’s assets are accounted for.
In the report, the local chain in New Zealand owes around $137 million to secured lenders, including Westpac and the National Australia Bank, with other secured creditors such as Ingram Micro and Synnex owed a chunk of $5.6 million.
According to the report, Ingram Micro is owed “computer hardware, software and accessories”, while Synnex is owed “computer hardware, software and accessories” plus money - although the report did not elaborate on how much.
In that group, fellow secured creditors include Acer, Apple, HP Inc, Panasonic, Spark, Sony, Toshiba and Vodafone.
Delving deeper, the report shows that in New Zealand, employees are owed $825,962, excluding redundancy payments, with the Inland Revenue also due $2.5 million.
Ferrier Hodgson - appointed receiver of the embattled electronics business in January this year - says the debt will be cross-collateralised across the group’s entire assets, which means returns to New Zealand creditors are dependent on what’s realised within other divisions of the group, as well as the Kiwi operations.
At the time Ferrier Hodgson was appointed, the company operated three bank accounts which held close to $2.1 million, with point of sale floats over the 62 stores standing at $55,650.
Dick Smith - which was incorporated in Auckland in 1981 - is part of an Australian publicly listed group, the Dick Smith Group, which operates 393 stores across Australia and New Zealand under four brands, Dick Smith, Electronics powered by Dick Smith, Move and Move by Dick Smith.
With all 62 New Zealand stores expected to shut down within the next seven weeks, the report claims it is “not practical” to estimate to finish date for the receivership at this stage.