// Beales has officially collapsed into administration
// The department store appointed KPMG as administrators after failing to find a new owner
// 1300 employees are at risk, although none of the 22 Beales stores are to shut down immediately
Beales has officially fallen into administration after failing to secure a sale to a new owner.
The department store appointed KPMG as administrators following a board meeting this morning.
While the retailer’s 1300-plus employees are now at risk of losing their jobs, it is understood that Beales’ 22 stores will operate as per usual, with no immediate closures confirmed although the retailer’s website has been taken down.
- Beales heads towards administration
- Beales paying £1m more in business rates than it should be
- 1000 jobs at risk as Beales lurches towards collapse
KPMG will also continue to seek a buyer for the 139-year-old business during the administration process.
The collapse comes after the Bournemouth-based department store chain, founded in 1881, filed notice of its intention to appoint administrators last week.
It had been mulling its future prospects amid a strategic business review that commenced in December.
Beales owner Tony Brown reportedly worked “tirelessly” to secure a future for the business.
Just before Christmas, the business appointed KPMG to conduct a strategic review and to examine different options for refinancing.
One the options included putting Beales up for sale.
The retailer had also been negotiating with landlords in the hopes of securing cuts to the rent of some if its 22 stores.
Beales employs around 1000 staff and another 300 in concessions, and all of its stores are located in regional cities and towns.
In the financial year to March 2019, the department store registered a loss of £3.1 million, up from £1.3 million for the year earlier.
The poor trading was attributed to rising costs, including business rates, and a dip in sales.
Last week, property consultancy firm Colliers International estimated that Beales paid £1.06 million more in business rates than it should have in the years since the revaluation of the commercial property tax scheme.
Beales was a public company for two decades until its shares were delisted in 2015. It has since been owned by several different private investors.
In 2016, it secured a CVA which saw rent reductions at 11 of its then-29 stores.
In October 2018, Beales was sold in a management buy-out to group chief executive Tony Brown.
The collapse comes as department stores in particular have suffered hardest from the high street downturn.
House of Fraser fell into administration in mid-2018, before it was snapped up by Mike Ashley’s Frasers Group – then known as Sports Direct International.
Last year, Ashley described how the House of Fraser’s finances were “nothing short of terminal in nature”.
Debenhams also fell into administration last year and was rescued by its lenders who launched a CVA shortly after.
The CVA has so far led to 19 Debenhams stores closing this month, with more planned in the future.
John Lewis suffered a tough Christmas too, with its parent company warning that the annual staff bonus could be scrapped this year.
Managing director Paula Nickolds also exited the department store amid its Christmas trading update.
Beales has stores in the following towns and cities:
- Chipping Norton
- St Neots