What happened

Naked Brand Group's (NAKD) stock price climbed 4.8% on Friday after the swimwear and intimate apparel maker said its shareholders voted to approve the sale of its traditional retail business.  

So what 

Naked Brand Group will now divest its unprofitable Bendon brick-and-mortar operations and focus solely on its e-commerce platform. CEO Justin Davis-Rice said the company would also consider purchasing other businesses to bolster Naked's online growth initiatives.

"Our Frederick's of Hollywood e-commerce business continues to perform, and we are currently evaluating several synergistic acquisition targets that could position Naked as a strong player in intimate apparel," Davis-Rice said in a press release.

A person is sitting behind a computer and giving a thumbs-up.

Investors applauded Naked Brand Group's new e-commerce-based strategy. Image source: Getty Images.

Davis-Rice also highlighted Naked's debt-free and cash-rich balance sheet. The apparel maker has amassed a war chest of $270 million in cash reserves following a series of share offerings in recent months.

Now what

Management believes this cash will generate better returns for shareholders in the potentially higher-margin e-commerce sector than the company has been able to achieve in its money-losing retail business. Time will tell if that's the case, though Davis-Rice certainly appears optimistic about Naked Brand Group's future.

"With available cash of $270 million, a clean balance sheet with no debt, and a reinvigorated management team and board of directors, I could not be more excited to execute on our business strategy to ultimately drive revenue growth with positive free cash flow," Davis-Rice said.