Australian book retailing giant Booktopia falls into voluntary administration

Australian online book retailer Booktopia has entered voluntary administration, following a first-half revenue downturn and struggles to secure additional funding.

The ASX-listed company on Wednesday appointed McGrathNicol restructuring partners Keith Crawford, Matthew Caddy, and Damien Pasfield as voluntary administrators.

The administrators are “undertaking an urgent assessment of Booktopia’s business while options for its sale and/or recapitalisation are explored”, McGrathNicol Restructuring said.

The first meeting of creditors will occur by Monday, July 15, with an exact date to be shared with creditors ahead of time.

The news arrives months after February’s difficult FY24 H1 trading update, in which the 20-year-old business revealed revenues of $86.3 million, down 22% from the prior corresponding period.

The business said its focus on upgrading its fulfilment centre contributed to lower sales, with cut-back inventory, slower delivery times, and wound-back marketing efforts hampering its efforts.

Those results marked a significant turnaround from its COVID-era results, buoyed by a surge in readers seeking books to occupy them through lockdowns.

Booktopia announced the redundancy of approximately 50 staff members in June as it sought to cut costs.

At the same time, the company announced co-founder Tony Nash, who departed the venture’s top job in 2022, would take on the role of executive director.

A fortnight later, Booktopia announced a voluntary share suspension, pending the results of a strategic review, “including its progress in seeking additional funding.”

Booktopia’s administration could be the most significant challenge it has faced since its founding in 2004.

It also marks a turnaround from its 2020 IPO, which saw its shares close at $2.60 in its first day on the ASX, giving the business a market value of some $357 million.

Booktopia shares traded at $0.045 when it suspended its shares in June.

Booktopia’s shares will remain suspended from trading for the course of its administration, with further shareholder updates pending through the ASX platform.

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