Shares plunge at troubled retailer
DEPARTMENT STORE giant Debenhams saw its shares plunge by 17 per cent after KPMG was called in to help draft emergency plans to save the troubled retailer.
The firm is said to be considering a list of options including a company voluntary agreement (CVA), a controversial insolvency procedure used by struggling firms to shut under-performing shops.
The company has brought in KPMG to help draw up the turnaround plans, according to
which first reported the news.
If Debenhams charges ahead with a CVA, it would join a raft of retailers including New Look, Carpetright and Mothercare, who have opted for the restructuring tool despite anger from landlords who have argued it leaves them out of pocket.
The news sent shares down more than 17 per cent in morning trading.
Debenhams later issued a trading update in reaction to media reports, saying it expects fullyear pre-tax profits of around £33m. Underlying earnings are forecast to come in at £157m, with net debt of approximately £320m.
Debenhams chairman Ian Cheshire stressed the board was continuing to work with its advisers “on longer term options, which include strengthening our balance sheet and reviewing noncore assets”.
The retailer last month said it would cut up to 90 staff at its fashion and home departments as part of a major cost-cutting drive. In January it announced plans to ramp up efficiency savings, with another £10m earmarked for this financial year and £20m extra annually. THE PRIME Minister is being challenged to call a General Election after being accused of “bankrupting” public services and doing “absolutely nothing” to help workers.
Frances O’Grady, general secretary of the TUC, said Theresa May had promised to help socalled just about managing families when she took office. But Ms O’Grady told the TUC Congress in Manchester that two years later, nothing had been done to stop Universal Credit cuts, tackle zero hours contracts, build enough council homes or improve wages.
She said: “We have a hearnothing see-nothing do-nothing Government. Working people deserve a better Government than this one.”
She told the Prime Minister to stand down if she cannot deliver a Brexit deal that protects jobs and rights, and properly fund public services.
“If you won’t give us the new deal that working people demand Mrs May, stand down and take your do-nothing government with you. Give us a general election and we’ll do everything in our power to elect a new Prime Minister who will.”
Today, Shadow Chancellor John McDonnell will tell the event that the Tories have stripped back employment rights to a level not seen since the economic depression of the 1930s. “The massive growth in zero hours contracts and gig economy have produced a workplace environment of insecurity not seen since the 1930s,” the Labour frontbencher will say.
“The decline of collective bargaining has meant that workers also now have little say over the key decisions taken by their employers over the future of their companies.”
Responding, Chancellor Philip Hammond said: “The last Labour government left over half a million more people out of work and every Labour government leaving office with unemployment higher than when it started. Under the Conservatives, there are over 3m more people in work with the security of a regular pay packet.”