Fashion chain Laura Ashley announces closure of 70 stores with the loss of more than 700 jobs after filing for administration amid coronavirus outbreak
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Laura Ashley has announced the permanent closure of 70 stores, with 721 employees set to lose their jobs.
It comes after the fashion and furnishings retailer slid into administration earlier this month, blaming the impact of coronavirus for tipping it over the edge.
It said it will continue to trade from its remaining 77 UK stores, which will remain open while online operations also continue to trade.
A woman wearing a face mask walking past a Laura Ashley store in South Woodford, London
The troubled retailer had been in talks with stakeholders over refinancing, but it said its ‘revised cash flow forecasts and increased uncertainty’ mean it will not be able to secure these funds in sufficient time.
Largest shareholder Mui Asia said it was unable to support the retailer with ‘financial support in the required timeframe’.
Laura Ashley said it hired advisers from PwC to oversee the administration, announced March 17.
The retailer operated 150 stores in the UK and employed around 2,700 staff – now significantly reduced.
Laura Ashley has announced the permanent closure of 70 stores, with 721 employees set to lose their job
Last week, it was reported that it was in discussions about the £15 million loan with private equity fund Hilco Capital to finance its immediate working capital requirements.
Laura Ashley said it had seen an upturn in sales in recent weeks, with trading up 24% year on year for the seven weeks to March 13.
However, it said the Covid-19 virus outbreak has ‘had an immediate and significant impact on trading, and ongoing developments indicate that this will be a sustained national situation’.
The chain’s troubles echo a wider malaise on the high street, which is struggling against online rivals, rising rents and business rates (file photo)
The announcement comes after a challenging period for the clothing and furnishings brand, which saw pre-tax losses balloon to £4 million in 2019.
Sales for the year also plunged by 11% to £109.6 million for the year. Shares in the company plummeted 68.9% to 0.3p in early trading today.
It has also asked for its shares to be suspended from trading on the London Stock Exchange.