According to the Austrian creditor protection association KSV 1870, the Graz-based Northland Outdoor Shop GmbH filed for bankruptcy on Wednesday. The company is a subsidiary of Northland GmbH, which operates the 22 Austrian branches of the outdoor outfitter as well as a location in the German city of Passau and the brand’s online shop. KSV 1870 announced that the parent company was not affected by the bankruptcy.
The bankruptcy was “essentially due to the restrictive measures taken by the corona pandemic in the last two years,” explained the creditor protection association. “Especially after the opening steps were taken, the 2G rule meant that the number of customers in the shops could no longer be measured as in the days before the pandemic.” There were also delivery difficulties and significantly higher transport costs.
In view of these burdens, the company got into financial difficulties. “Long-term rental agreements have been concluded” for the branches, some of which have not proven to be “as profitable as calculated”, according to a statement. Attempts by the company to negotiate more favorable conditions were “mostly not appreciated” by the landlords concerned. So it was not possible to reduce the fixed costs. In addition, the war in the Ukraine had “dampened the hoped-for upswing” in the current year, explained the KSV 1870.
The association announced that a restructuring procedure without self-administration had been decided. The aim is now to pay out “a quota of 20 percent of their claims” to the insolvency creditors. Of this, 5 percent would be paid out by means of a cash quota, and “the remaining 15 percent within 24 months after acceptance of the restructuring plan”. For the time being, the company “is to be continued under the supervision of the insolvency administrator,” said KSV 1870. “The procedure will show” whether branches have to be closed.