Women’s fashion specialist Alexon Group is searching for further financial backing due to the recent dampened consumer environment, it was confirmed today.
Like-for-like sales for the group rose 0.9 per cent year-on-year in the 22 weeks to July 2nd 2011, but a statement released by the company today reveals that tough trading conditions on the high street have impacted its business turnaround strategy.
The retailer admitted that its performance for the current financial year will be negatively affected by the lack of consumer spending and other economic constraints, while poor trading last Christmas has curtailed investment in the business’s recovery measures for now.
CEO of the group Jane McNally told Retail Gazette last December that the drop in festive revenues, primarily due to the snow, would not impact the company’s long-term strategy but the group announced today that it is searching for new finance options.
Today’s statement said: “The group is actively exploring options for a more appropriate capital structure which will firstly reduce the debt in the business and secondly enable the group to invest in the next stages of the turnaround plan.
“Such investment would be targeted towards the group’s systems infrastructure and would take account of what is expected to remain a difficult economic and retail environment in the near term.”
The group owns a number of brands, which are primarily targeted at older women, and they experienced differing fortunes over the 22 weeks.
Kaliko, Alexon and Eastex performed well, thanks largely to the success of new spring and summer collections, but it was a different story for Dash and Minuet, which both saw sales decline and the former continued to feel the impact of cotton raw material inflation.
Trading at Ann Harvey remained broadly flat, according to the group, while the performance of department store concessions was mixed.
Online sales for the period were up 115 per cent year-on-year, and McNally has previously acknowledged that multichannel development will continue to be a key focus for the business in the months ahead.
As well as seeking new investment, Alexon says it is progressing well with the sale of two former warehouses in Milton Keynes and Cardiff, which if offloaded will provide a boost to funding. However, it predicts that the tough trading environment will persist for the rest of the year.