An iconic store on life support: DJs gets more time, but no more money

April 28, 2026 — 4:00pm

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Talk about corporate cliffhangers! There is really no other store like David Jones – at least when it comes to its ability to remain on commercial life support.

At the 11th hour, it has reportedly signed with lenders Gordon Brothers to refinance a $150 million to $190 million facility, which will give it access to an extension of time but not additional funds.

This may be little more than an exercise in kicking the can down the road, but it will be a much-needed reprieve.

There is no hint about the length of the lender’s extension or what additional or more stringent conditions (or covenants) may have been included in the deal. David Jones didn’t even return calls to confirm what looks to be a positive development.

David Jones has a historic and iconic place in the history of Australian retailing, but like many of its kind around the world, it has been in structural decline for decades as it competes with online retailers and standalone brand stores.

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For most of the year, the retailer’s suppliers have been effectively funding the company by reluctantly agreeing to a later payment schedule.

Trading payment terms have been stretched out from January to as late as March in some cases. Suppliers have said some payments have been made, but David Jones is still not up to date.

David Jones denied the existence of a cash squeeze, but said new technology systems were the culprit.

According to David Jones’ official spokespeople, this move to extend payment terms was about enhanced transparency – although it left a trail of disaffected and confused suppliers, many of whom spoke to the media on condition of anonymity.

For many suppliers, David Jones is a vital distributor – even those that have their own standalone retail outlets.

Many, particularly small suppliers, had to agree to the extended payment terms at the risk of being dropped, but the longer wait to be paid could put their own finances in a more precarious position.

(The large supermarkets are governed by a Food and Grocery Code of Conduct that offers protection for suppliers in an asymmetric power relationship with the likes of Coles and Woolworths.)

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Some suppliers defected to rival Myer while others abandoned exclusive deals with David Jones.

Anchorage Capital Partners acquired David Jones in 2022 for just $100 million, a fraction of the $2.2 billion Woolworths Holdings paid for the business in 2014, in a deal that also included CBD properties that were subsequently sold.

It clearly illustrates the decline in David Jones’ ability to generate healthy profit.

David Jones reported a loss of $74 million in 2024, which is the last set of accounts filed with the Australian Securities and Investments Commission. And there are unconfirmed reports that the 2025 financial year result was broadly similar.

Those 2024 accounts were released in March last year and the 2025 accounts have not yet been seen.

Private Equity groups like Anchorage often acquire companies in the hope of exercising a turnaround in the business before selling them for a profit.

Anchorage pumped $250 million into revamping the David Jones stores, and beefing up its loyalty scheme and IT systems, so it has a lot riding on the outcome of the department store’s retail resuscitation.

The good news is that the 2026 financial year has been a stronger one for most discretionary retailers.

“Trading conditions for David Jones in the first half of the 2026 financial year have been strong and show growth on the previous comparable period,” the company said.

Whether this improvement has continued in the current half of the financial year in which consumer sentiment has been challenged by higher interest rates and war-related uncertainty remains to be seen.

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