LOCAL empowerment company Brimstone Investment Corporation’s more than 20-year relationship with clothing manufacturer House of Monatic (HoM) has ended.
Sometimes that relationship hung by a thread – with HoM struggling against cheaper imports and watching as informal wear at work gradually replaced the donning of suits. HoM – which is over 100 years old – was best known for its stylish Carducci suits.
Still, HoM was one of the last clothing manufacturing enterprises still left in the Western Cape. The business was a significant employer in Cape Town, and thus there was constant fretting that after many years of successive losses that Brimstone would pull the plug in the company.
But last month it was confirmed that HoM had been sold to The Foschini Group (TFG) – one of South Africa’s biggest fashion retailers – for an undisclosed sum.
HoM staff will be merged into Prestige Clothing, another enduring clothing manufacturing enterprise based in Cape Town.
According to a report in the Weekend Argus, Graham Choice – the head of TFG Design Centre, Manufacturing and Prestige Clothing – said Prestige would be integrating the HoM employees.
Choice said: “This is part of a multifaceted attempt to retain scarce skills in the clothing and textiles industry and specifically in Cape Town, where this industry has been decimated over the past two decades.”
Older readers might remember that even in the nineties Cape Town hosted a good number of JSE-listed clothing manufacturing ventures – including Seardel, Rex Trueform, Pals, Towles Edgar Jacobs (TEJ), the Strebel Group, Pointer Fashionware, Burlington Industries and Romatex.
None of these companies remained on the JSE, and most have disappeared entirely or adapted their business models away from pure manufacturing. Seardel is still in existence in form of Deneb Investments, but most of its clothing manufacturing operations has been sold to the SA Clothing and Textile Workers Union (SACTWU).
HoM was not listed, but was part of the late Doug de Jager’s JSE listed industrial conglomerate Lenco Holdings. In the late nineties Brimstone acquired HoM from Lenco.
Like fishing (where Brimstone owns stakes in Oceana and Sea Harvest), HoM was seen as an integral part of the Western Cape economy and a key component in retaining local employment.
Brimstone worked tirelessly in trying to find profitable traction for HoM – including an ambitious plan to build a retail platform that unfortunately did not work out as envisaged.
Brimstone had for many years been under pressure from some shareholders to cut its losses at HoM, and to focus on its more profitable ventures in fishing and health care.
To its credit, Brimstone – which has worked hard to cull its debt in the last 12 months – held out valiantly at loss-making HoM. But the strain was starting to show…and, if trade union representatives are to be believed, HoM was on the verge of closure.
In the year to end December, House of Monatic’s revenue decreased by 57% to R58.6 million (2019: R137.3 million) and the company reported a hefty loss of R104.8 million (compared to a loss of R32.6 million in the prior year).
Brimstone CEO Mustaq Brey noted that the current year’s loss included the recognition of impairments of R38.8 million on property, plant and equipment and inventory as well R6.1 million in retrenchment costs incurred during the year.
He explained that the Covid-19 pandemic had profoundly changed the social behaviour of consumers and had normalised remote working. “These changes had the effect of severely decreasing demand for formal wear, which is HoM’s core product.”
Brey said consequently HoM started to manufacture cloth face masks and certain items of personal protective equipment. The business was classified as an essential service provider.
“While this enabled the company to provide some work to employees during the level 5 national lockdown, orders were not nearly enough to fully utilise production capacity and make the business sustainable.”
Besides selling the core clothing manufacturing business to TFG, HoM has also decided to run-down the retail operation over the remainder of the year in an orderly manner.
Whether consumers will still see the Carducci suits donning fashion racks at TFG’s Markham’s outlets remains to be seen.
The Weekend Argus reported that Choice said Prestige had big plans for the future. “Through its design and manufacturing division, TFG will upgrade the plant and manufacturing processes in line with their quick response manufacturing methodology. We believe that combining modern machinery and processes with the excellent skills House of Monatic employees have developed over decades will produce quality formal wear and will ensure commercial return for shareholders.”
Well, here’s to stitching together another 100 years…albeit in a different form.
