The loss of the domestic underwear manufacturer Palmers more than tripled to 14.7 million euros in the 2023/24 financial year. Sales fell from 71.5 million to 66.6 million euros, as shown in the annual financial statements. The annual deficit resulted from depreciation and value adjustments amounting to 8.6 million euros, including due to the withdrawal from Eastern Europe, and losses of 6.1 million euros in operating business.
As part of the “strategic realignment“, Palmers wants to concentrate on its core business in Austria, Germany and Croatia. The laundry company has previously also been active in the Czech Republic, Slovakia, Slovenia, Hungary, Italy and Hong Kong. In the 2023/24 financial year, 84.4 percent of Palmers sales came from Austria, 8 percent from Germany, 3.3 percent from Croatia and the rest from other countries.
Loans amounting to 14 million euros
Palmers Textil Aktiengesellschaft also owns the insolvent mouth and nose protection (MNS) and FFP2 protective mask producer Hygiene Austria. At the end of June, the company was ordered to close as part of the bankruptcy proceedings.
In the middle of next year, Palmers will have to refinance loans worth millions. “A key assumption for the positive continued existence forecast is the negotiation of the loans amounting to 14.418 million euros (COFAG) that are due on June 30, 2025. The first actions are already being taken here with the aim of restructuring the loans and subsequently “To repay installments,” it says in the annual financial statements in the subsection on negative equity (-2.7 million euros).
The refinancing is “also dependent on support from the public sector (e.g. through new guarantees)”. In addition, “the indirect owners issued a letter of comfort to maintain operational payment obligations, which is valid until July 31, 2025.”
550 employees employed
At the beginning of the year, the laundry company had 150 of its own locations and almost 100 franchise branches in 16 countries. The company now wants to reduce locations in this country as part of the restructuring program. “We will have to reduce the branch network in Austria from around 120 to around 100 branches in the next 24 months,” announced Palmers CFO Kristian Radosavljevic.
Around 550 employees worked at Palmers in 2023/24. “We are not planning any layoffs, we are more faced with the challenge of long-term employees retiring and we are faced with the problem of finding good people,” explained Palmers board member Jung.