Carpetright stores to close as B&Q and MossBros reveal sales woe

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Dire news piled up on the UK High Street today as Carpetright admitted stores will have to close, shares in Moss Bros and B&Q’s owner Kingfisher plunged after they revealed poor sales and the owner of Claire’s Accessories filed for bankruptcy in the US.

Jobs are under threat at Carpetright after the floorings retailer confirmed reports that it was ‘exploring’ a company voluntary arrangement to keep the business afloat. That would allow it to close loss-making shops and secure discounts on rental costs.

If the CVA goes ahead, Carpetright would also ask investors for between £40million and £60million via an equity issue to fund plans to reboot the business and drive down debt.

Jobs are under threat at Carpetright after the floorings retailer confirmed reports that it was 'exploring' a company voluntary arrangement to keep the business afloat.

Jobs are under threat at Carpetright after the floorings retailer confirmed reports that it was 'exploring' a company voluntary arrangement to keep the business afloat.

Jobs are under threat at Carpetright after the floorings retailer confirmed reports that it was ‘exploring’ a company voluntary arrangement to keep the business afloat.

The group, which has 409 UK shops, also agreed a £12.5million unsecured loan from major shareholder Meditor to help with ‘short-term working capital requirements’.

B&Q owner Kingfisher revealed that annual profits had tumbled more than 10 per cent and warned of an ‘uncertain’ UK outlook after a recent hit to sales.

The group said B&Q like-for-like sales slumped 5.1 per cent in the final three months of its year.

At its better-performing Screwfix arm, sales growth slowed to 7.1 per cent amid falling demand for so-called ‘big ticket’ ranges such as kitchens.

B&Q owner Kingfisher revealed that annual profits had tumbled more than 10 per cent.

B&Q owner Kingfisher revealed that annual profits had tumbled more than 10 per cent.

B&Q owner Kingfisher revealed that annual profits had tumbled more than 10 per cent.

B&Q is in the middle of an overhaul, which has seen it shut 65 shops and slash around 3,000 jobs in the UK and Ireland over the last two years. 

Shares in Kingfisher fell 8 per cent to 311.2p.

Meanwhile, a profit warning emerged from suit tailoring retailer Moss Bros that sent its shares crashing on the open of stock market trading.

Moss Bros said sales had suffered a triple whammy from stock shortages, low footfall and sluggish suit hire demand.

Moss Bros said sales had suffered a triple whammy from stock shortages, low footfall and sluggish suit hire demand.

Moss Bros said sales had suffered a triple whammy from stock shortages, low footfall and sluggish suit hire demand.

It said sales had suffered a triple whammy from stock shortages, low footfall and sluggish suit hire demand, and that meant profits would be ‘materially lower’ than current market expectations for the year to January 26 2019.

Shares recovered from a fall of nearly 30 per cent to stand 18 per cent down at 48.1p, with traders also noting that it had slashed its full-year dividend by 32 per cent to 4p to ensure it could make future payments to shareholders.

It marks the second profit warning issued by the firm since the start of the year after it endured a ‘very tough’ December.

The US company behind Claire’s Accessories has filed for bankruptcy protection as part of a move to reduce its debt by $1.9billion (£1.3billion).

Claire’s Stores said its shops, including 378 in the UK, will remain open as it presses ahead with a financial restructure. It will see lenders including Elliott Management and Monarch Alternative Capital inject $575million of fresh cash into the group.

Claire’s is owned by private equity firm Apollo Global Management, which paid $3.1billion for the company in 2007. 

Struggling Mothercare meanwhile has called in accountants to advise on crunch talks with lenders and stave off collapse.

The mother-and-baby retailer has appointed KPMG to help it obtain waivers for loan agreements with banking lenders HSBC and Barclays. 

Since the start of the year, its share price has plunged more than 76 per cent as it was hammered by two profit warnings.

The US company behind Claire's Accessories has filed for bankruptcy protection as part of a move to reduce its debt by $1.9billion (£1.3billion).

The US company behind Claire's Accessories has filed for bankruptcy protection as part of a move to reduce its debt by $1.9billion (£1.3billion).

The US company behind Claire’s Accessories has filed for bankruptcy protection as part of a move to reduce its debt by $1.9billion (£1.3billion).

Carpetright chief executive Wilf Walsh said it would be ‘business as usual’ for the flooring firm’s stores during Easter and it would remain in ‘close contact’ with staff over its restructuring plans.

He said: ‘I am pleased that we have secured this additional support from one of our major shareholders as we continue to explore the feasibility of a CVA and a conditional equity issue.

‘These further cash resources will enable us to make the necessary decisions free from short-term funding pressure.

‘The aggressive store opening strategy pursued by the company’s previous leadership has left Carpetright burdened with an oversized property estate consisting of too many poorly located stores on rents which are simply unsustainable.’

Kingfisher chief executive Veronique Laury said: ‘Our performance this year has been mixed, however, with solid growth at Screwfix and Poland offset by continued weaker sales in France and some business disruption, principally reflecting product availability and clearance.

Mothercare has appointed KPMG to help it obtain waivers for loan agreements with banking lenders HSBC and Barclays.

Mothercare has appointed KPMG to help it obtain waivers for loan agreements with banking lenders HSBC and Barclays.

Mothercare has appointed KPMG to help it obtain waivers for loan agreements with banking lenders HSBC and Barclays.

‘We are acting on the causes of this disruption, however; next year will be another big year in our transformation plan.’

She added: ‘The outlook for our main markets is also mixed. The UK is more uncertain, France is encouraging yet volatile, whilst the market in Poland remains supportive.’

Moss Bros chief executive Brian Brick said the retailer was taking action early to protect the ‘underlying strength’ of the business, as it faces up to a ‘very challenging’ year ahead.

He said: ‘The beginning of the year has been hampered by short-term stock delivery issues caused by the consolidation of our supplier base.

‘The resulting stock shortage has undoubtedly driven a significant shortfall in sales, which will continue until late spring.

‘Although this has been a painful experience, I am confident that the availability issues are well on track to being resolved and the margin benefits from the consolidation will flow through.

‘This stock shortage has led to a disappointing start to the year and, whilst we are still at a very early stage of our new financial year, the more cautious consumer environment and the effect of short-term weather impacts has led to a readjustment of our profit expectations to protect the group’s longer-term investments.’

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