Laura Ashley eyes 15 million pound lifeline to avoid administration
Laura Ashley is reportedly considering calling in administrators by the end of March if it cannot secure a 15 million pound lifeline from Homebase owner Hilco Capital.
The British fashion and homeware retailer, which operates 150 stores in the UK, is in advanced negotiations about the loan with Hilco Capital, according to Sky News. If the struggling retailer does not secure the loan in the coming weeks it could collapse.
Administrators are expected to be put on standby in the coming days.
On Friday, the company confirmed in a statement seen by Sky News that it was in talks about the 15 million pound loan with an unnamed third-party.
The statement said: “If the group is unable to secure a commitment for the requisite level of funding by the end of March to satisfy its ongoing working capital requirements and turnaround plan, then the group will need to consider all appropriate options.”
Commenting on the ongoing Coronavirus outbreak and its impact on business, the company said: “Whilst the company has not yet seen a significant financial impact due to COVID-19, the company believes that it has the potential to negatively influence future trading as a result of reduced footfall and continues to monitor the situation closely.”
For the 26 weeks to 31 December, losses before tax at Laura Ashley widened by 166 percent to 4 million pounds compared to 1.5 million pounds the prior year.
Total group sales dropped by 10.8 percent to 109.6 million year-on-year while total like-for-like retail sales were down 10.4 percent.
Photo credit: Laura Ashley, Facebook