Outdoor clothing and equipment retailer Blacks Leisure has had to extend its current banking facilities due to poor trading, it has been announced today.
In the 19 weeks to July 9th 2011, its total group sales reached just £54.6 million compared to £61.3 million for the same period last year and like-for-like trading declined 9.7 per cent year-on-year.
The summer sales period has brought a level of recovery however, with the six weeks from the end of May showing a LFL sales rise of 3.2 per cent compared to 2010 but the group has still been forced to increase its banking loans.
A trading update from the retailer this morning read: “Since the year end the group’s indebtedness has increased significantly due to both normal seasonal factors and the challenging market conditions affecting the UK retail sector as a whole.
“Therefore, the group has been working alongside its bankers, Bank of Scotland plc, to extend and increase its banking facilities.”
Blacks will now have total banking facilities of £40 million until December 15th 2011 at which point they will revert to the previously agreed core facility of £35 million, supplemented at by an additional £3 million for seasonable peaks.
A start date has also now been set for incoming CEO Julia Reynolds, with the former Figleaves.com boss joining the firm on August 1st.
Despite struggling sales and a tricky financial situation Blacks claims it is still looking to invest in the business as part of its transformation initiative.
Earlier in the year it was confirmed that its Broadwear range was to be scrapped with stores either closing or converting to its core Outdoor fascias, and in the last quarter four outlets underwent this process, with one closing, and the remaining five will soon follow suit.
Today’s statement continued: “The board is also considering the group’s overall capital requirements with a view to strengthening its capital structure and providing a platform to support the group’s plans for development and growth.