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Fashion retailer Laura Ashley could call in administrators by the end of March unless it receives a £15m funding lifeline from Hilco Capital, reports have revealed.
According to Sky News, Hilco Capital is currently in “advanced” negotiations with the embattled retailer, but administrators could be put on standby in the next few days depending on the outcome of the talks.
The funding would secure almost 2,700 jobs at the retailer’s 150 UK stores.
It comes after Laura Ashley reported losses before tax of £4m for the half-year period ended 31 December 2019.
The retailer attributed the “disappointing” loss to lower sales in home furnishings and “Brexit uncertainty”, and said revenue disruption was also caused by changes with its Japanese franchise partner.
The retailer also saw a 10.4% decrease in like-for-like sales, as total group sales fell to £109.6m compared with £122.9m in 2018.
Additionally, Laura Ashley reported a 10.8% fall in group sales due to the closure of three stores and “weaker consumer’s confidence” during the period. The retailer said online sales also decreased by 15.5% to £22.2m.
Laura Ashley said at the time: “There have been market challenges for our business which have impacted these results during the current financial year. The decline in total revenue was due to the market headwinds and weaker consumer spending during the period, which led to a decline in sales of bigger ticket items.”
