N Brown sales decline as it secures £50m finance deal
Online retailer N Brown Group has agreed new financing arrangements to help it trade through the current difficult period, as the group reports sales have dropped by 25%.
The board regards this performance as creditable in the circumstances and said it is "hugely grateful for the commitment and flexibility shown by colleagues" throughout the business.
The company secured a new three-year £50 million facility, provided under the Government’s Coronavirus Large Business Interruption Scheme.
It also has a securitisation facility of up to £500 million and an overdraft facility of £27.5 million.
Apparel sales at the Manchester-based group were down by 48% over the same period. The business had however seen significant growth in home and gifting sales, as sales shot up by 74%.
Following FCA guidance, on 14 April, the group also offered customers in financial difficulty as a result of COVID-19 the option to defer payments for three months. As a consequence, the business expects cash collections to be lower over the coming months.
Steve Johnson, CEO, N Brown Group, said: "In what remains a very uncertain environment, we have been balancing our number one priority of looking after our colleagues, with a commitment to continue serving our loyal customers, whilst ensuring the business has the resilience to navigate the various challenges we are facing.
"We are pleased to have secured support from both our banking partners and the Government's loan scheme, which help to strengthen our financial position and gives us the flexibility and certainty to manage through this challenging period.
"In addition, the immediate and substantive actions we took at the very outset of this crisis have supported our working capital positively in this period."
The retailer has taken a number of actions to minimise costs and the impact of coronavirus, including an 80% reduction in marketing expenditure, furloughing 30% of staff, deferring its tax payments and voluntary pay reduction from the Management Board and Senior Leadership Team.