ADLER FASHION CHAIN FILES FOR BANKRUPTCY

Lockdown, which was introduced in Austria in mid-December, has led to the bankruptcy of a famous clothing chain - Adler reported filing bankruptcy petition in the district court. It is assumed that the organization will face restructuring under the supervision of an interim manager.

Adler brand has twenty-four branches operating in Austria. The fashion chain was unable to survive the unprecedented drop in sales that coincided with the period of Christmas holidays. Almost all 24 branches were closed and due to this fact the retailer turned out to be practically insolvent.

In total, Adler employs more than 3.35 thousand employees that work in 171 stores.

Experts note that Adler became an example of how a completely successful company, the net liquidity of which in 2019 amounted to € 70.3 million, faced the threat of financial collapse in just one year of the global crisis. Whether the organization will now be able to reach record sales of almost € 0.5 billion, prior to the crisis, is unknown.

Austria became the first European country to introduce restrictive measures for the third time at the end of 2020. It was announced that from December 26 to January 17, all residents are invited to undergo COVID-19 tests and in case the results of testing for infection are negative, citizens will be able to return to normal life. The rest, including those who refuse to undergo the medical examination, should wear special masks and be isolated at home.

An attendance at schools, as well as visits to shops and restaurants for citizens, who have not passed the antibody test, are prohibited.

It is clear that it will be very difficult for Adler's branches to continue working in such conditions. Despite the fact that the head of the company Thomas Freude is determined to the possibility of returning the company to normal work, the economic crisis in Austria continues to develop.

Earlier, the state managed to stop the expected wave of bankruptcies with subsidies from the budget. However, experts predict a new wave of bankruptcies in 2021. The Austrian government does not intend to extend the moratorium on mandatory contributions and payments which was introduced until March 31. At the same time, a significant part of the Austrians have already faced debts due to the loss of jobs and the accumulation of financial obligations.