new CFO Mr. Cesare Fazari reports
RYU UPDATES SHAREHOLDERS REGARDING CANADIAN CTO
RYU Apparel Inc. has received a cease trade order (CTO) from the British Columbia Securities Commission, which went into effect in other trading jurisdictions across the country. The CTO has come into effect due to a failure to file the company's annual financial statements and its subsequent first quarter financials. As a result, the TSX Venture Exchange has suspended trading in the company's securities and will be subject to reinstatement.
The delay of the filing of the audit has been caused by several issues. COVID-19 has materially impacted the company's business, which has put the company in a position whereby certain assets have had to undergo a valuation and further impairment analysis of assets not normally exposed due to performance issues related to store closures. Additionally, the new management has been carefully assessing the value of the company's current inventory and all its remaining assets. The closure of stores has created a cascading effect on the financial position and statements of the company, when (at the time of the initial due date of the extended time period of June 15, 2020) the company's existing accounting staff were not equipped to address the complexity of the challenges, which led to the appointment of the new chief financial officer. Due to the number of staffing changes alongside COVID-19, retrieving certain financial information requested by the audit team has taken longer than a typical audit cycle. The new chief financial officer, the chief executive officer and RYU staff are working diligently to complete all the audit requests with the company's auditor and fully anticipate being able to file the annual statements and the first quarter financials and accompanying management discussion and analysis within a 30-day timeline.
The company intends to apply to the British Columbia Securities Commission for a partial revocation of the CTO as soon as practicable as the company's chief executive officer, Cesare Fazari, continues to strongly support the company and intends to finance immediate cash shortfalls. He commented: "We are righting the ship and unfortunately the timing of our audit completion has been delayed, but I'm exceedingly confident in our go-forward strategy, and I have been and will continue to personally fund the company's short-term cash requirements. We've reordered inventory and I'm excited to get the company back on track for the fall of 2020."
About RYU Apparel Inc.
Respect Your Universe is an award-winning urban athletic apparel and accessories brand engineered for the fitness, performance and lifestyle of the athletic man and woman. Designed without compromise for fit, comfort and durability, RYU exists to facilitate human performance.
We seek Safe Harbor.