Cafe chain accepts loan from own CEO to turn around losses
Former chair Mark Richardson and CEO Jason Gunn at Oliver's lisitng
Mon 29 July 2019 - 1:40 pmNews
Oliver’s on Monday said it had accepted an offer from Jason Gunn, whose 17.3 per cent stake makes him the company’s major shareholder, for a short-term loan as it deals with a $331,000 deficit left after cutting costs.
The company did not specify the size of the loan but said its cash reserves would bottom out in August.
Oliver’s said the first quarter – which runs July 1 to September 30 – is traditionally its softest trading period, but it still aims to perform at break even or slightly better.
“We have been through a process of rebuilding the culture, restructuring the offering, and the team, ensuring we have everyone in the correct position with a clear understanding of their role in driving this business into the future,” Mr Gunn said.
“There has been a palpable, positive shift in energy at all levels of the business, with both the team and the customers responding positively to that shift.”
Mr Gunn returned to the helm of the company in February amid a management clear-out aimed at stemming worsening losses.
Four unprofitable stores have since been closed and a new overhead structure implemented as management eyes a return to profitability in FY20.
Oliver’s has already flagged an earnings loss of around $5.3 million for the 2019 financial year.
Shares in the company rose by 0.3 cents to 3.7 cents by 1027 AEST.