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In an Australian menswear first, M.J. Bale will be 100% carbon neutral by the end of 2021.

The 11-year-old menswear brand, which operates over 50 stores across Australia, is working on a series of emission reduction strategies to reduce its carbon footprint.

Scientist Andrew Moore of Life Cycle Logic has begun a formal carbon footprint assessment of the entire organisation, including M.J. Bale’s extended ecosystem of partners and suppliers.

The assessment will be completed in early 2021, then independently audited.

Where existing technologies prevent the brand from eliminating carbon output, M.J. Bale will completely offset in verified projects operating within the regenerative agriculture and renewable energy spheres in Australia and abroad.

CEO Matt Jensen said the move is at the heart of brand values. 

“As an Australian-owned brand we enjoy certain privileges of the land and environment.

"But these privileges carry responsibilities. We recognise that future generations of Australians will inherit the decisions we make today.

"And as we saw in the recent bushfires, if we lose our environment, we lose our communities and livelihoods. In my mind, investing in the environment is investing in our collective future – we don’t consider it optional.”

Life cycle assessment expert Andrew Moore praises the move.

“I've been impressed by the enthusiasm and level of commitment that everyone at M.J. Bale has demonstrated to a carbon neutral future for the brand.

“It has also been very encouraging to see how quickly the supply chain partners have become involved and transparently shared information on their operations.

"From my experience, these two ingredients – commitment and willingness to collaborate – are key for the success of a carbon neutral program.”

The A2 Milk Company has named David Bortolussi as its new MD and CEO. He will take up the role in Sydney early next year, succeeding Geoffrey Babidge who has been interim CEO since last December.

Bortolussi is currently group president – international innerwear with apparel company HanesBrands. As CEO of Pacific Brands from 2014, he oversaw the group’s restructure prior to its acquisition by HanesBrands in 2106 when he was tapped for his current role.

In a statement, A2 Milk Company highlighted Bortolussi’s extensive exposure to Pacific Brands and HanesBrands’ Asian sourcing markets, particularly China, including various brand-distribution partnerships in the region.

A2 Milk Company chairman David Hearn said the appointment followed an extensive global search. 

“David has demonstrated significant skill in guiding businesses through periods of significant growth whilst also effectively managing the changes that expansion frequently requires,” he said.

“The A2 Milk Company is going through a period of continued strong growth in dynamic markets and David’s skillset and comprehensive strategic and operational experience will serve the company well.”

Bortolussi said the A2 had created “a very distinctive consumer proposition, amazing brand and strong culture with so much potential” and he looked forward to being part of the company’s next growth phase.

Hanes Australasia chief executive and group president David Bortolussi has resigned to take up an opportunity outside of apparel.

Locally, Hanes is home to several apparel and lifestyle brands, such as Bonds, Bras N Things, Champion and Sheridan, and trades across a 500 store network.

Bortolussi was brought on during the acquisition of Pacific Brands by Hanes in 2016, and worked at Pacific since 2009.

During the last 11 years Bortolussi has helped the businesses achieve significant growth, Hanes said, and transformed it into a leading omnichannel retailer.

“David has also developed a purpose driven culture, focused on diversity and inclusion, sustainability and strong community partnerships to increase our impact beyond our own business,” Hanes said.

Bortolussi will remain at the helm until February 2021 to ensure the company has adequate time to appoint a new leader.

Internationally, Hanes trades in more than 40 countries, and employs around 63,000 people.

"Premier Retail’s online sales deliver significantly higher EBIT margin than the EBIT margin of the retail store network," the company said. Second half EBIT is expected to grow between 9.7 per cent and 11.7 per cent to around $59 million.

Sales at the company's reopened stores since May have been strong, it said and Premier implemented "hard" cost-cutting measures across the business. The company also stopped paying suppliers during the shutdown period.

However, Premier has also been a significant beneficiary of the federal government's JobKeeper wage subsidy program and a similar program in New Zealand, with the company signing on to the scheme in April after total sales fell 74 per cent during the first six weeks of the second quarter.

The company noted it had "maximised" the use of various subsidy schemes along with rent relief globally, however, it did not specify the amount claimed through JobKeeper.

With 12,000 staff stood down around the world, the amount of JobKeeper claimed by Premier is likely to be in the tens of millions. In New Zealand, the company has claimed $NZ4.56 million ($4.19 million) for 840 staff.

Premier also refused to pay rent for its stores during the pandemic shutdown, a move that has likely significantly reduced costs for the company. Further details on the subsidy amounts will be provided at the company's full-year results in late September.

Angus Gluskie, managing director at Premier shareholder White Funds Management, said while the significant stimulus received by Premier was a short-term win for the business and its shareholders, he questioned if that was the intention of the JobKeeper program.

"On the one hand, the government subsidies are doing what they meant to do, which is to offset a downturn. But in the case of Premier making a lot of money from the online side of their business, ... it's not quite what its meant to be doing," he said.

"In the short run, [Premier] has been an incidental beneficiary of what's occurring, but it's certainly not exactly what was intended."

However, the fund manager said Premier's online performance had also been a key contributor to the record figure, noting the business had positioned itself well by investing in its online platform prior to COVID-19.

These results relate to Premier's retail division only and not to its investment portfolio, which includes sizeable stakes in department store Myer and appliance manufacturer Breville, the latter of which fell 8.4 per cent to $25 on Thursday after reporting a weaker-than-expected full-year result. Premier's 26 per cent stake in the company is worth around $880 million.

Michael Hill has revealed the power of virtual offerings during COVID-19, witnessing 22,000 customers utilise its new 'Virtual Ring Try-On' feature. 

Launching the new digital initiatives in July, the business has also seen 200 customers make 'Virtual Personal Jewellery' appointments. 

Michael Hill chief brand and strategy officer Vanessa Brennan said that the business introduced the features to ensure customers had access to a high-quality experience while shopping on digital channels.

"We’re always looking for unique and exciting ways to engage and connect with our Michael Hill community.

"Choosing jewellery is so personal and we want to provide the highest quality customer service at every touchpoint – whether it be digitally or in-store," she said. 

In virtual appointments, customers can connect with a Michael Hill expert advisor to get help on jewellery fitting, styling or engagement ring consultations. 

The consultants are equipped to help a range of customers, with virtual appointment language options including English, Mandarin, Hindi, Taiwanese, Punjabi and more.

Meanwhile, customers are also able to try on 950 products virtually through the Virtual Ring Try-On feature. 

Using augmented reality technology, customers can take a picture of their hand and will then see the ring placed on their finger. 

For those customers who still prefer to shop in-store, Michael Hill is offering appointments with in-store consultants who will offer dedicated time to providing personalised assistance. 

Roughly two years after Napoleon Perdis ended its 16-year relationship with David Jones, the makeup brand, now under new ownership, is returning to the department store’s beauty counter in 12 locations across the country, as well as online.

As part of this change, Napoleon Perdis products will no longer be available in Priceline stores. The start of the brand’s partnership with Priceline in June 2018 coincided with its exit from David Jones.

At the time, the brand’s founder and then-CEO Napoleon Perdis told Inside Retail that Priceline was Australia’s answer to the successful US beauty chain Ulta, and that the pharmacy retailer’s broader reach would allow him to grow.

But just six months later, the brand entered voluntary administration. According to a report in the Australian Financial Review, the administrators determined the brand was likely insolvent on or about September 30, 2018, after losing $2.2 million and $2.4 million in the previous two quarters.

In April 2019, creditors handed control of the company to Kuba Investments, a private investment company headed up by China marketing expert Livia Wang and former Witchery and Marcs executive Henry Lee.

The partnership with David Jones is a major milestone in the revitalisation of the brand under their ownership.

Starting this month, Napoleon Perdis will be available on David Jones’ e-commerce site, and will subsequently launch in 12 department stores, including Bondi Junction and Miranda in the Sydney area and Rundle Mall in Adelaide. There are plans to expand into additional stores in the future.

“This reinforces our positioning as Australia’s number one prestige makeup brand and will also allow greater accessibility for customers to shop with us,” Lee, Napoleon Perdis’ new CEO, said in a statement.

“This is just the start of our journey to reinvigorate our brand both domestically and internationally.”

The focus over the past 15 months has been on expanding into new sales channels, which has paid off, according to Lee. New sales channels now account for 35 per cent of overall sales.

In terms of product, Lee said the company is focused on extending the brand’s existing product ranges, launching newly formulated products and providing a first-class in-store experience.

“We will continue on our mission to deepen the emotional connection with our customers and to re-establish Napoleon Perdis’ position within the market as a beauty authority,” he said.

Lee also referenced the brand’s educational and artistry background (the founder was a makeup artist). But while the makeup brand retains his name, Napoleon Perdis is no longer involved in the business.

"We really got caught in a perfect storm leading to voluntary administration, but our dream to do something meaningful in the world via kikki.K has been so strong we’ve done everything we can on behalf of all stakeholders," Ms Karlsson said.

"It’s a great feeling to come through it with a brilliant result in the circumstances and with the overwhelming support of creditors."

Tonia Misvaer, the chief executive of Erin Condren, said the business had long admired kikki.K's designs and jumped on the opportunity to buy the business out of administration.

"We look forward to working with everyone at kikki.K through this restructuring process and returning the brand to profitability," she said.

Kikki.K stores outside of Victoria are open and trading again, the company said.

Scott Langdon and Rahul Goyal, administrators of the Seafolly group, today announced the purchase of prominent Australian swimwear brand Jets.

Langdon said the purchase made strategic sense.

“It makes a lot of sense to bring Jets into the Seafolly group because the two businesses serve different market segments in the fashion swim category.

"The combination presents clear and material synergies around design, wholesale and supply chain.”

Jets is part of the PAS Group which was put into administration in May.

Jets and other companies in the group were put on the market soon afterwards.

Negotiations began while the Seafolly administrators were conducting a sale process for the Seafolly Group, Langdon said.

"All interested parties who signed confidentiality agreements in the final stages of the Seafolly process agreed that the Jets purchase would make Seafolly a stronger business.

"This in turn provided more competitive tension and a better return for Seafolly creditors than would have been the case.

"The Jets purchase will be funded with new money.”

Langdon said the Jets business would be mainly a wholesale and e-commerce offering for the time being.

The purchase was sealed over the weekend.

The acquisition is announced a week after the overwhelming vote by Seafolly creditors to accept a Deed of Company Arrangement (DOCA) that will save the business.

The DOCA was recommended by the Administrators because it offered the best return to creditors.

When executed, the DOCA returns Seafolly to its previous owners.

Excluding the direct benefit from the subsidy, profit would have only increased marginally, but chief executive Mark Ronan said the company would have posted a record result even without the wage subsidies.

However, Mr Ronan admitted Adairs' result would not have been anywhere near as strong if not for the broader economic benefits induced by the $85 billion subsidy.

"There's no doubt that JobKeeper and wage subsidies in New Zealand enabled customers and consumers to continue to spend on retail," he said.

"Without them, we would have seen a much more dire economic response overall."

Adairs has been a major beneficiary of Australia's pandemic spending habits, with housebound Australians spending big on their homes during the country's lockdowns in April and May.

This was reflected in the company's jump in online sales, which doubled over the period and now accounts for 34.8 per cent of total sales. Adairs’ recently acquired online furniture and homewares retailer Mocka also performed better than expected, with revenue up 50.2 per cent for the period to $29 million.

Retail stores across Sydney were packed as shoppers returned to the streets in search of last-minute Mother’s Day gifts.

Adairs' digital channel will be a renewed focus for the business, Mr Ronan said, with the company hoping to leverage its Mocka acquisition to better target the nascent online homewares and furniture sector.

"[The pandemic] really highlighted the benefit of being omnichannel and that in itself should see us continue to invest in that pathway," he said. Adairs is constructing a new Melbourne-based national distribution centre to help it grow its online channel.

Morgans analyst Jo Little said the result was well above expectations and highlighted the company's "negligible" debt position of just $1 million as a major positive.

"We think buoyant trading conditions can continue over the balance of [the first half of the current financial year]," she said.

The retailer has continued to see strong trading at its stores and online into the new financial year. For the first five weeks of the 2021 financial year, online sales have doubled and like-for-like store sales are up 15.8 per cent, however, the business did not provide profit guidance.

The company declared a full franked dividend of 11 cents per share, which will be paid on September 24.

Excluding the direct benefit from the subsidy, profit would have only increased marginally, but chief executive Mark Ronan said the company would have posted a record result even without the wage subsidies.

However, Mr Ronan admitted Adairs' result would not have been anywhere near as strong if not for the broader economic benefits induced by the $85 billion subsidy.

"There's no doubt that JobKeeper and wage subsidies in New Zealand enabled customers and consumers to continue to spend on retail," he said.

"Without them, we would have seen a much more dire economic response overall."

Adairs has been a major beneficiary of Australia's pandemic spending habits, with housebound Australians spending big on their homes during the country's lockdowns in April and May.

This was reflected in the company's jump in online sales, which doubled over the period and now accounts for 34.8 per cent of total sales. Adairs’ recently acquired online furniture and homewares retailer Mocka also performed better than expected, with revenue up 50.2 per cent for the period to $29 million.

Retail stores across Sydney were packed as shoppers returned to the streets in search of last-minute Mother’s Day gifts.

Adairs' digital channel will be a renewed focus for the business, Mr Ronan said, with the company hoping to leverage its Mocka acquisition to better target the nascent online homewares and furniture sector.

"[The pandemic] really highlighted the benefit of being omnichannel and that in itself should see us continue to invest in that pathway," he said. Adairs is constructing a new Melbourne-based national distribution centre to help it grow its online channel.

Morgans analyst Jo Little said the result was well above expectations and highlighted the company's "negligible" debt position of just $1 million as a major positive.

"We think buoyant trading conditions can continue over the balance of [the first half of the current financial year]," she said.

The retailer has continued to see strong trading at its stores and online into the new financial year. For the first five weeks of the 2021 financial year, online sales have doubled and like-for-like store sales are up 15.8 per cent, however, the business did not provide profit guidance.

The company declared a full franked dividend of 11 cents per share, which will be paid on September 24.

Engagement in sustainability has deepened during the COVID-19 crisis, with European consumers wanting fashion players to act responsibly and consider the social and environmental impacts of their businesses.

While the fashion industry is reorganizing for the next normal after the COVID-19 crisis, European consumers have become even more engaged in sustainability topics. That presents an opportunity for the fashion industry to reiterate its commitment to sustainability. Moreover, now could be the moment to drive less seasonality in the fashion system.

Our survey was conducted in April 2020 across more than 2,000 UK and German consumers.¹ It is part of a firmwide effort to capture consumer sentiment during the COVID-19 crisis.

Sentiment toward sustainability

Amid the shock and uncertainty that the fashion sector is facing during the COVID-19 crisis, there is a silver lining for the environment: two-thirds of surveyed consumers state that it has become even more important to limit impacts on climate change. Additionally, 88 percent of respondents believe that more attention should be paid to reducing pollution.

In practice, consumers have already begun changing their behaviors accordingly. Of consumers surveyed, 57 percent have made significant changes to their lifestyles to lessen their environmental impact, and more than 60 percent report going out of their way to recycle and purchase products in environmentally friendly packaging (Exhibit 1).

Emphasis on social and environmental commitments

While the industry is reorganizing for the next normal, it should consider that consumers want fashion players to uphold their social and environmental responsibilities amid the crisis. Of surveyed consumers, 67 percent consider the use of sustainable materials to be an important purchasing factor, and 63 percent consider a brand’s promotion of sustainability in the same way.

Additionally, surveyed consumers expect brands to take care of their employees, as well as workers in Asia, during the COVID-19 crisis (Exhibit 2). That highlights the need for brands to maintain ethical commitments, despite the crisis.

Overall, it is imperative to build trust and transparency with consumers, as 70 percent are sticking with brands they know and trust during the crisis. Of surveyed consumers, 75 percent consider a trusted brand to be an important purchasing factor. However, younger consumers, particularly Gen Zers and millennials, are more likely to experiment with smaller or lesser-known brands during the crisis (Exhibit 3).

 

Shift in purchasing behavior

With 88 percent of consumers expecting a slow recovery or a recession, general consumer confidence is low. As a result, consumer spending on fashion is also changing. More than 60 percent of consumers report spending less on fashion during the crisis, and approximately half expect that trend to continue after the crisis passes. However, consumers are likely to cut back on accessories, jewelry, and other discretionary categories before reducing their spending on apparel and footwear (Exhibit 4).

 

When it comes to making changes to purchasing behavior, younger consumer segments are willing to buy cheaper versions of products they normally buy—approximately 50 percent of Gen Zers and millennials in our survey report trading down (Exhibit 5).

 

The COVID-19 crisis has recruited new consumers to online channels: 43 percent of surveyed consumers who didn’t purchase fashion online before the crisis have started using online channels. And that shift is unlikely to reverse, as nearly 28 percent of consumers expect to buy less at physical stores—a trend seen in higher shares in Generation Z and millennial respondents (Exhibit 6).

 

Mindset on fashion cycles and circular business models

The survey findings indicate that the consumer mindset is not strongly tied to the fashion cycle, so now could be the moment to drive less seasonality in the fashion system. Of surveyed consumers, 65 percent are supportive of fashion brands delaying the launch of new collections as a result of the COVID-19 crisis. Additionally, 58 percent of respondents are less concerned about the fashion of clothing than other factors following the crisis, and consumers now cite newness as one of the least important attributes when making purchases (Exhibit 7).

 

As a result of the COVID-19 crisis, 65 percent of respondents are planning to purchase more durable fashion items, and 71 percent are planning to keep the items they already have for longer (Exhibit 8). Additionally, 57 percent of respondents are willing to repair items to prolong usage.

 

Particularly among younger European consumers, there is interest in purchasing secondhand fashion items following the COVID-19 crisis. Of surveyed consumers, around 50 percent of Gen Zers and millennials expect to purchase more items secondhand (Exhibit 9).

 

Overall, consumer sentiment suggests that the COVID-19 crisis could serve as a reset opportunity for players in the apparel, footwear, and luxury sectors to strengthen their sustainability commitments and accelerate industry-wide changes, such as reduced seasonality and scaling of circular business models.

Furniture retailer Nick Scali has survived the trials and tribulations of FY20 unscathed, with annual net profit staying flat at $42.1 million and sales revenue only dropped 2.1 per cent to $262.5 million.

The profit result landed ahead of the business’ expectations of between $39 and $40 million, largely because of an increase in sales across Australia and New Zealand following each country’s respective lockdowns. 

Trading in July was “extremely buoyant” according to the business, with written sales up 70 per cent on the same period of last year. 

And, since 65 per cent of Nick Scali’s products are  made to order with a delivery lead time of 9 to 13 weeks, the company’s opening order book for FY21 is significantly higher than in previous years. 

“As a result of the strong sales revenue growth and after allowing for 6 weeks of temporary closures in our Melbourne showrooms, the company expects first half profits to up by at least 50-60 per cent when compared to 1H FY20,” the company wrote in a statement on the ASX. 

“This remains subject to no further extensions of existing restrictions in Melbourne, further store closures across the network as a result of government imposed lockdowns, or any material delays in the supply chain affecting deliveries.”

The furniture and homewares space has seen stronger results than other parts of the industry, with many customers using the lockdown opportunity to redecorate or rethink their living spaces.

Online furniture business Temple & Webster grew active customers 77 per cent year on year during FY20, with many first time buyers coming online during Covid-19.

But sales were further affected by significant falls in foot traffic, in particular in CBD locations. The metropolitan Melbourne region has taken a hit following new stage four restrictions because of the resurgence of the virus in Victoria.

Myer said there had been strong growth in online sales throughout the second half of 2020.

Sales at rival department store David Jones slid 8 per cent over fiscal 2020, despite foot traffic increasing in the last nine weeks of the year as COVID-19 restrictions eased around the nation.

Meyer said in a statement that because of cost-cutting, support from the federal government via JobKeeper and rent relief and deferrals, it expected to report a small net cash positive position at the end of fiscal 2020, compared with $39 million in net debt at the end of fiscal 2019.

Myer said further details would be provided at its full-year results announcement in September.

GPT announced an 8.8 per cent reduction in the value of its direct retail property portfolio in June and Vicinity last month slashed 11.3 per cent off the value of its 60-property portfolio. The value of Stockland's retail property assets fell by 10 per cent.

The portfolio devaluation is in line with expectations by investment bank JP Morgan that asset values will decline by between 25 and 30 per cent over the next 12 to 18 months.

Scentre said the devaluation was preliminary and still needed finalisation and would not affect operating earnings or funds from operations, the industry's preferred measure of profit.

Costco is to develop a $60 million warehouse and fuel station project in Lake Macquarie City in New South Wales’ Hunter Valley region. 

Occupying a 14,000sqm site, part of the former Pasminco mining company’s land, the development will be Costco’s fourth warehouse in the state. The project will include the improvement of the footpaths, landscaping and roads around parts of the site.

According to the company, the development will create more than 225 jobs for the Lake Macquarie community, once finished.

“Their [Costco’s] commitment shows the confidence in our city and demonstrates what we can achieve when we work closely with the private sector to create new investment opportunities,” said Kay Fraser, Lake Macquarie Mayor. 

“We have been looking for a suitable location for some time in the greater Newcastle area and this site really ticks all of our boxes,” said Patrick Noone, country manager at Costco. “Costco sees this region as dynamic and fast-growing and we believe that we can bring great value in relation to a wide range of products and services to the community.”

Fraser said Costco’s project will attract more shoppers from the Hunter Valley, greater Newcastle and Central Coast, supporting local jobs and boosting the local economy.

 “The Costco plans come on the back of a record $1.5 billion worth of development applications approved in the 2019-2020 financial year, and really demonstrates how Lake Mac is increasingly becoming the city of choice for investment and development,” said Glenn Bunny, Lake Macquarie City council head of development and planning. 

 The new warehouse and fuel station are scheduled to launch within 12 months, pending approval.

A large number of businesses in metropolitan Melbourne will be forced to close under the city’s stage four restrictions from 11:59pm on Wednesday night, including the majority of retail stores.

In a press conference on Monday afternoon, Victorian Premier Daniel Andrews announced there would be three categories of business: those that can remain open for on-site work, those that will need to close, and those that will have to scale back and operate at a significantly reduced capacity.

Businesses that are considered essential and will remain open largely as per usual include supermarkets, grocery stores, bottle shops, pharmacies, petrol stations, banks, news agencies and post offices.

“That means people do not need to be going and buying six weeks worth of groceries,” Andrews said.

“I understand that there is a sense of concern in the community and hopefully the clarity of the message today, you do not need to do that because supermarkets as well as grocery stores, the local fruit and veg, the local butcher, the baker, all of those shops – they will remain open.”

Other businesses allowed to remain open in the Melbourne metropolitan area include locksmiths, laundries and dry cleaners.

Some businesses will be required to close altogether

Retail stores, some manufacturing, and some administration businesses will close in Melbourne from 11:59pm on Wednesday night.

“As heartbreaking as it is to close down places of employment, while I never thought that I would be telling people not to go to work, that is what we have to do in order to stop the spread of this wildly infectious virus, this deadly virus,” said Andrews.

Retailers will be allowed to work on-site for the purpose of fulfilling online orders. Premier Andrews also gave the example of Bunnings Warehouse locations being closed to customers, but being available for contactless pickup and delivery.

Personal care services including hairdressers will also close, as will car washes.

Meat works, which the premier said had provided a “serious” challenge in terms of COVID-19 transmission, will move to two-thirds production, and will be subject to strong safety precautions.

“There will be some of the most stringent safety protocols that have ever been put in place in any industrial setting,” said Andrews.

“Those workers will be essentially dressed as if they were a health worker. Gloves and gowns, masks and shields, they will be working in one workplace only, they will be temperature checked, they will be tested.”

The restrictions on meat works apply statewide and not just in the Melbourne metropolitan area, unlike the restrictions on retail.

New restrictions on construction

Under the stage four restrictions, changes have also been made to construction, which Andrews described of “the lifeblood of the Victorian economy”.

Commercial building construction will no longer be allowed to have more than 25% of staff on site, with only five people allowed on-site for residential construction.

The workforce on large government projects has been cut by half. “We will continue project by project to look at ways we can further reduce the number of staff while doing so safely,” Andrews said.

“We are moving them to a pilot light phase, not being turned off completely but they are dramatically reducing the number of people they have working for them and their output over the next six weeks,” he added.

There were 429 new cases of COVID-19 reported on Monday, with 36 linked to known outbreaks and 393 under investigation. 13 new deaths were reported, of which eight are linked to aged care.

416 Victorians are currently in hospital, with 35 in intensive care.

As reported by The Australian Financial Review last week, under the DOCA, creditors were divided into three pools depending on their continuing importance to Seafolly.

Pool A creditors – those deemed critical to its future – would receive 100¢ in the dollar; pool B creditors – deemed important to its future – would receive 50¢ in the dollar; and pool C creditors – those considered non-essential or unlikely to continue to trade with the company – would receive 3¢ in the dollar.

ASIC was worried that the administrators, Scott Langdon and Rahul Goyal from KordaMentha, were unable to clarify which "pool" each creditor would participate in before the creditors' meeting on Monday.

ASIC was also worried that, depending on how creditors were allocated to each pool, creditors in Pool C might receive less than 3¢ in the dollar and closer to the amount they would receive if Seafolly were liquidated.

If Seafolly had fallen into liquidation, unsecured creditors would have received nothing, he said.

L Catterton Asia, a partnership between global luxury goods company LVMH, its major shareholder Groupe Arnault and US private equity firm Catterton, acquired a 70 per cent stake in Seafolly in 2014 from the founding Halas family and bought out the remaining shares two years ago.

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These results are above consensus expectations for the company, with Macquarie analysts predicting in June that the company would report a full-year EBITDA of $298.1 million.

Super Retail attributed the numbers to "stronger than expected" trade through June, with comparable sales spiking 27.7 per cent, following a similar 26.5 per cent jump in May. These gains largely offset the 26.2 per cent decline in April amidst the peak of the country’s COVID-19 lockdown.

"Given the volatile trading environment, we are very pleased with these results," chief executive Anthony Heraghty said.

"The group’s omni-retail channel business strategy has enabled our businesses to adapt quickly to changing consumer behaviour during COVID-19 and delivered a resilient trading performance."

However, net profit after tax will stay largely flat on the prior year at around $153 million to $154 million, largely due to lower margins from increased online sales and higher costs for implementing social distancing measures.

The unaudited results released on Friday also exclude $54 million in pre-tax abnormal items, which cover back payments for underpaid staff, asset write-downs, support office restructures and the exit of some non-core businesses.

Super Retail completed a $203 million capital raise in June to help expand the business' online capacity and invest further in the company's existing brands. Online sales at the retailer rose 126.2 per cent through April and May, representing nearly 20 per cent of the company's total sales.

The positive update on Friday, coupled with the $203 million raise, means the business is well-placed to grow through the 2021 financial year, Morgans analyst Jo Little said."Regardless of the broader economic back-drop, Super Retail's businesses should continue to benefit from the obvious domestic consumption tailwinds for a while yet," she said.

Outside of staff in some small-format MacPac stores, Super Retail did not use the government's JobKeeper stimulus, which Ms Little said provided investors with greater clarity when assessing future performance and removed a "key unknown" for retailers currently.

Super Retail will provide its audited full-year results to the market on August 24.

The virus was quietly seeding across Europe in January and February without anyone realising what was happening; some sewer tests even showed it present in Milan and Turin as early as mid-December.

Australia holds a much better grip over testing than most nations and therefore a much better understanding of how many people have it. The number of daily tests in Australia right now is about 2.4 for every 1000 people, but only 0.91 in much-vaunted Germany and 1.85 in the UK where COVID-19 is arguably a far greater risk of flaring again.

As imperfect as it is, Victoria also has a track and trace system in place whereas the pandemic swept across Europe so fast that hunting down infected people and asking them to self-isolate was effectively impossible. New South Wales boasts a track and trace regime that probably ranks among the world's best.

Daily announcements about a particular restaurant or workplace closing following the discovery of a positive case should be seen by the public and the media as cause for comfort rather than alarm. They show the system is working. People in Britain and Italy were deprived of such crucial information, and it clearly contributed to the scale of the calamity.

Australia has other advantages, too. Australians are now told to use masks to minimise risk but such advice was missing during the crucial early stages in Europe. I recall travelling around northern Italy in late February where maybe 1 out of every 20 people wore masks. If only they knew then that masks could have helped control the outbreak. In Britain, mask wearing was actively discouraged early on and only became mandatory in shops and supermarkets last week.

Intensive care capacity has also been dramatically expanded in Victoria and NSW. A huge factor behind Italy's horrendous death toll is that hospitals in the hard-hit north never had a chance to ramp up the number of beds and staff. The consequence? More than 30,000 of the country's 35,000 victims came from the north.

Finally, what's happening in Australia is not an isolated experience. Other countries that had early success in suppressing the virus like Israel and Japan have also been hit by spikes. The former chief medical officer, Dr Brendan Murphy, last month said national cabinet's suppression strategy "always envisaged that we would get some outbreaks."

Australia is at least confronting those outbreaks from a position of strength other countries could only dream of. For state and federal governments, this means there are no excuses to get things wrong.

But until a vaccine is found or a political leader openly embraces a total eradication strategy, uncertainty is the new normal. In that environment, a little perspective can't hurt.

After less than a month in administration, courting more than 15 offers, Seafolly looks set to be saved by its former owner L Catterton.

Administrators KordaMentha picked the [Asia-based private equity firm] as the preferred bidder for Seafolly on Monday, stating it’s offer provides the best returns to “all” creditors and staff, with more than 110 employees set to keep their jobs at the 20 stores that will remain open.

“This is a terrific result after a very competitive process,” KordaMentha administrator Scott Langdon said.

“With an optimised retail, online and wholesale network, Seafolly will continue to be the iconic Australia beachwear brand that customers know and love.”

Prior to administration, Seafolly traded across 44 stores in Australia and 12 stores overseas.

L Catterton put forward a deed of company arrangement, which will be voted on at next Monday’s meeting, 3 August.

And while the administrators are praising the deal, some creditors are questioning why the business that led Seafolly to administration is the best bet to return it to glory.

An unnamed source told AFR that L Catterton had driven the business into the ground, closed many stores and made hundreds of its workers redundant, and was now buying it back “for cents on the dollar”.

“In spite of that, the administration process has been orchestrated in a way that makes it very difficult for anyone but L Catterton to acquire the business,” the source told AFR.

“We have reason to believe this process was a done deal even before the pandemic hit.”

Questions have also been raised around the speed of the administration, with Seafolly going into administration on June 29 – less than a month ago.

Other recently collapsed brands, such as Tigerlily, saw months go by before the administration process reached a satisfying conclusion.

L Catterton acquired Seafolly through a series of transactions between 2014 and 2018.