23rd Mar 2020 11:44
(Alliance News) - N Brown Group PLC on Monday said it has suspended all dividend payouts for the foreseeable future, adding it expects earnings for financial 2020 to be lower than previously expected.
The British fashion retailer expects adjusted pretax profit for its financial year ended February 29 to be lower than previous guidance of between GBP70 million to GBP72 million.
It added it expects a delay to the publication of results, initially scheduled to be released April 29, due to working restrictions.
N Brown said in the past week daily product sales have fallen by over 40% compared to expectations due to a "significant and sudden" reduction in demand. It expects a material reduction in demand through financial 2021, and no guidance will be given for its current year.
The group is implementing measures to preserve liquidity such as reducing marketing expenditure, stopping all non-essential capital expenditure, and working with HMRC to defer all tax and national insurance payments.
The company also said it has stopped all stock purchases as well as freezing all recruitment and "reviewing organisation structures".
N Brown said it has financing facilities totalling GBP652.5 million, comprising a GBP500 million securitisation facility, a GBP125 million revolving credit facility and a GBP27.5 million overdraft.
As at Friday, the company was fully drawn on the securitisation facility to GBP414.7 million and fully drawn down on the revolving credit facility. It had also drawn down GBP9.0 million on the overdraft and held cash balances of GBP46.3 million.
It is in talks with lenders regarding additional funding and is also exploring options in relation to its unencumbered freehold properties with an original cost of GBP58.3 million.
Shares in N Brown were trading 14% lower at 23.06 pence each on Monday morning in London.
By Ife Taiwo; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Brown Group