Fashion group collapses, staff owed $500k

Lifestyle group Luxury Retail No.1, which has three stores in Melbourne and two in Sydney, went into receivership in early August, due to concerns about the business’s viability.

The move was pushed by London-listed Mulberry Group, which has committed funding for the fashion group, including ensuring employees are paid, customer orders are honoured and its five shops remain open.

According to a report filed to ASIC, approximately 170 staff at Luxury Retail No.1 are owed $575,851 in entitlements as of September.

The report by McGrathNicol partner Barry Kogan shows that $415,695 in superannuation payments are owed.

Six employees are owed at least $10,000 in super, with one staff member owed $32,341 in super and $17,956 in annual leave payments.

It’s not just employees who are owed by the group according to the report, with Luxury Retail No.1 in debt to creditors by more than $19.7 million.

A significant portion of the money owed is to Mulberry, with debts of more than $4.1 million to the company‘s Australian branch and $1.4 million to the U.K. branch.

The largest portion of the money owed is to a related company called Luxury Retail Treasury, with an eye-watering debt of more than $8.4 million.

Luxury Retail Treasury was linked to the collapsed company Sneakerboy, which entered administration in early July.

Though the move to appoint receivers to Luxury Retail No.1 is separate from efforts to save Sneakerboy, it is under the same ownership of the failed group.

Entities related to directors Nelson Mair and Theo Poulakis own Luxury Retail No.1, with the pair also owning and directing Sneakerboy and Luxury Retail Group through corporate vehicles.

Sneakerboy and Luxury Retail Group’s ownership was split between companies owned by Mr Poulakis and Mr Mair, similar to how the pair directed Luxury Retail No.1.

NCA NewsWire has gone to Luxury Retail No 1 for comment.