Grocery chain Harris Farm Markets saw its losses more than triple in the last fiscal year, citing serious problems with its software system upgrade.
The family-owned company’s losses rose from $6.2 million to $22 million in the year ended June 30 despite sales growing 5.6 per cent to $788 million, the Australian Financial Review reported, citing financial accounts lodged with the corporate regulator.
The company said its new software system caused major disruptions to its stock management and payments systems, resulting in higher costs.
The problems were then resolved, and trading returned to normal towards the year-end.
By plunging deeper into the red, Harris Farm breached its bank covenants, as it failed to meet the conditions outlined in their loan agreement, the AFR reported. However, the bankers agreed to grant a waiver.
The company has refinanced with its lenders to increase its debt facilities from $230 million to $290 million, with an additional $100 million to be funded for growth and expansion plans.
Founded in 1971, Harris Farm has 33 stores in NSW, Queensland and Canberra.
