Axe fears grow for New Look’s 26 NI stores
Struggling fashion chain could close 100 UK shops
THERE are fresh worries for staff at the 26 Northern Ireland stores belonging to fashion retailer New Look.
The embattled chain is reportedly considering the closure of as many as 100 UK stores as part of a radical turnaround plan to cut costs and improve profitability.
This includes the 60 stores marked for closure under a company voluntary arrangement (CVA) approved in March. At that time, New Look indicated that the 60 outlets did not include any of its 26 Northern Ireland stores.
Executive chairman Alistair McGeorge said yesterday that the number which will definitely close after negotiations with landlords is now at 85. Discussions are ongoing regarding a further 13 stores, of which Mr McGeorge said around half were likely to close.
It is not clear how the growing number of closures will impact Northern Ireland. Yesterday the company said it would not disclose a list of stores being considered for closure.
It’s understood New Look will look to vacate its flagship store in Belfast’s Donegall Place after Primark bought the building. However it’s understood that the company is seeking to relocate the store in the city centre, rather than close it. Around 60 people are currently employed in the outlet.
While the new strategy adopt- ed by New Look has so far yielded higher profits, sales have continued to decline.
Figures released yesterday show that the company posted an underlying operating profit of £22.2m for the first half, compared to a loss of £10.4m in the same period last year. But revenue declined by 4.2 per cent to £656.9m.
Like-for-like sales under the New Look brand dropped by 3.7pc, a slower rate than last year’s 8.6pc drop.
The high-street mainstay said the slide in sales was in line with its plan to improve profitability with more full-price sales.
Speaking to the Press Association, Mr McGeorge said the first part of the recovery was going well, but that he would like to “move faster”.
“We’re not looking to defend our position, we’re looking to attack,” he said.
In addition to the restructuring of its UK base, New Look last month announced its decision to exit its retail business in China, where it has 148 stores.
Annualised cost savings of £70m have now been achieved, with another £8m to be added.
As part of the turnaround, New Look has also improved its UK market share and ramped up online operations, increasing click and collect sales by 41pc in the first half.
However Mr McGeorge warned that conditions on the high street remain challenging.