New Look CFO Richard Collyer is reported to be meeting its various landlords in the coming days as they brace themselves for possible rent reduction requests and store closures.
The troubled high street fast fashion retailer is believed to be considering the closure of up to 60 of its 600 stores as it seeks to restructure the business and return it to profitability.
New Look is also reported to be investigating the possibility of a Company Voluntary Arrangement or CVA (a legally binding agreement with a company’s creditors which allows a proportion of its debts to be paid back over time), according to The Sunday Times.
The business, which is majority owned by South African investor Brait, has £1.1bn in debt and has been hit by tough trading conditions and, by its own admission, ranges which have failed to hit the mark with its customers.
Last September it parted company with its former CEO Anders Kristiansen and its former chairman Alistair McGeorge was invited back in November to attempt a turnaround, having previously revived the business’ fortunes in 2011.
Earlier this month the business reported that overall group revenue was down -6.3% at £1.07bn and UK like-for-likes were down -10.7% in the 39 weeks to 23 December, as heavy discounting in the third quarter took its toll. Underlying operating loss for the nine months year-to-date were £5.1m while losses before tax hit £123.5m.
“I am confident that we are now making the necessary changes to get the company back on track and we continue to have sufficient liquidity to deliver our plans. In particular, we are focusing on reducing costs, recovering the broad appeal of our product and reconnecting with our customers,” McGeorge said at the time.
It has also been reported that its bondholders had been seeking protection of their interests ahead of an expected financial restructure.