EDUN is seeing red. The Africa-centric fashion label, which U2 frontman Bono launched 2005 with his wife, Ali Hewson, in 2005, recorded losses of €5.9 million ($7.88 million) in the 12 months leading to December 2012, according to numbers filed with Ireland’s Companies Registration Office. Together with the $8.5 million shortfall it reported in 2011, EDUN’s accumulated losses now stand at a combined $54.5 million. Still, the Hewsons remain undaunted. In their directors’ report, the celebrity couple says they are “very satisfied with progress during the year, which was in line with the [five-year] strategic business plan projections”.
TROUBLE IN PARADISE?
EDUN is in the “investment phase” and has made significant progress in growing its supply chain, brand, and retail partnerships, as well as the implementation of its mission, they add.
EDUN had amassed a debt of $11 million when LVMH purchased a 49 percent majority stake in 2009.
“It has been tough, and I think it’s fair to say that we were a little naive about the challenges at the start,” admitted Ali Hewson in a press conference earlier this year. “We’re not making money yet, but we’ve survived a recession. We’re still in the game and growing. It’s a long-term commitment.”
EDUN’s monetary problems are hardly news. The brand had amassed a debt of $11 million when Louis Vuitton Moët Hennessy, the world’s largest luxury goods group, purchased a 49 percent majority stake in 2009. The influx of cash, mostly by way of shareholder loans, has allowed EDUN to retain its “going concern” status.
Shareholders have confirmed they will not seek repayment for the “foreseeable future” and will provide the company with “sufficient finances to ensure [its] continued operation.”