SYDNEY Australia's biggest upmarket department store operator Myer Holdings Ltd (MYR.AX) said on Wednesday the local franchisee of British fashion retailer Topshop, of which it owns one fifth, has appointed voluntary administrators.
In a regulatory filing, Myer said the local franchisee, Austradia Pty Ltd, appointed administrators, and that the two companies would work with Topshop's British parent, Arcadia Group, "to deliver the best outcomes for customers and other stakeholders".
The move, just six years after Topshop launched in Australia, reflects the tough trading conditions facing the country's bricks-and-mortar retailers amid intense competition from "fast fashion" chains like H & M Hennes & Mauritz AB (HMb.ST) and online giants such as Amazon.com Inc (AMZN.O).
Last month, Amazon said it planned to open its online shopfront service for third-party retailers, Amazon Marketplace, in Australia, prompting several stock analysts to downgrade earnings forecasts for traditional retailers - including Myer.
This month, Myer posted a 3.3 percent decline in third-quarter sales, citing "challenging trading conditions" without specifying a contribution from Topshop. In February, Myer said its share of the Topshop franchisee's loss grew to A$600,000 (£345,235) in the first half, from A$100,000 in the same period a year earlier.
Administrators Jim Sarantinos and Ryan Eagle, of restructuring firm Ferrier Hodgson, said the company will trade as normal while they work with the UK Topshop owners on "supporting and right-sizing the Australian business to a sustainable platform going forward".
Topshop and Topman operate nine stand-alone stores, 17 Myer concessions and an Australian online business.
(Reporting by Byron Kaye; Editing by Vyas Mohan)