Home-Fix finds itself in a financial fix

Singapore

HOME-Fix is pulling the shutters down on all its retail stores in Singapore by the end of this week, marking the end of the brick-and-mortar presence of one of Singapore's well-known consumer brands.

This comes as the home-improvement retail company undergoes interim judicial management, while facing some S$19.8 million in liabilities on its books.

A creditors' meeting held on Tuesday attracted more than 70 people, including suppliers and landlords. Creditors who spoke to The Business Times on condition of anonymity said Home-Fix's founder, Low Cheong Kee, had spoken at the meeting about some of the difficulties faced by the company in recent years.

One issue was refurbishment works at Great World City and Thomson Plaza, which hit the sales in Home-Fix's outlets in those two malls - incidentally its highest-grossing branches.

Works at Great World City started mid-April last year and are expected to end by the third quarter of 2020; those at Thomson Plaza began in July and should be completed by the second quarter of next year.

The works at the malls include retrofitting new entrances from the MRT stations coming up nearby. Both malls are on the upcoming Thomson-East Coast line.

The Home-Fix stores in those two malls shut down for good in August.

These outlets aside, some of the chain's other stores have apparently been loss-making from the outset due to factors like poor location and the shift to online shopping.

To ride the wave of e-commerce, the company launched its online retail store, TISBO (Try In Store Buy Online), last December, but it has not been able to outdo other online platforms that offer competitive delivery rates. TISBO remains in operation.

Mr Low, who transformed his father's old hardware store into this chain of DIY stores, had been a poster boy for embracing and adapting to retail trends. He opened the first Home-Fix shop in 1993.

Just last year, the chain was held up by Prime Minister Lee Hsien Loong at his May Day rally as an example of a retail business that was responding to changing demand and technological disruption.

In January, Mr Low told BT in an interview that he had been on a "right-sizing exercise" for the Singapore outlets in the last 21/2 years to cope with rising rent and manpower costs.

With this "right-sizing", the chain was down to 11 stores in Singapore at the start of this year.

In its heyday, it had more than 20 outlets in both Singapore and Kuala Lumpur.

BT understands that Home-Fix's late payments may have emerged around April for some parties. The company's store in Compass One, a mall in Sengkang, was repossessed that month.

At Tuesday's meeting, creditors said Mr Low plans to revive the company by tapping other services it offers, such as home repairs and training courses.

The company is also said to be in talks with three potential white knights, all of whose interests differ. For instance, one is eyeing Home-Fix's business across the Causeway; another may want to provide a space for the company.

When BT last spoke to Mr Low on Tuesday, he said he would call back after a meeting, but never did.

According to regulatory filings, Home-Fix recorded a profit after tax from continuing operations of S$11.7 million in 2016, but fell into a loss of S$3.2 million the following year.

In 2017, the company's total liabilities stood at S$21.2 million, versus S$21.8 million in the preceding year.

In the High Court, Justice Aedit Abdullah granted Home-Fix interim judicial management, saying it is to "rehabilitate the company or preserve all or part of its business as a going concern, and/or achieve a more advantageous realisation of the company's assets than would be effected in a winding up."

Home-Fix is represented by Tan Kok Quan Partnership.