Topic: Carillion scrambles to stay afloat

[CraigDS]

The Coast deal needs looking at too.

They are going under and closing their bricks and mortar side of the business (24 stores, 300 jobs) but sold the online and concessions side of the business to Karen Millen.

The issue? Well Coast and Karen Millen have the same owner. So it very much seems like them taking out part of the business that was worth something (did they pay market value? was it open to other offers?) and then letting the other side just go bust.

[Nobby Reserve]

The Coast deal needs looking at too.

They are going under and closing their bricks and mortar side of the business (24 stores, 300 jobs) but sold the online and concessions side of the business to Karen Millen.

The issue? Well Coast and Karen Millen have the same owner. So it very much seems like them taking out part of the business that was worth something (did they pay market value? was it open to other offers?) and then letting the other side just go bust.

The entire insolvency (and limited liability) laws in this country might be good in theory, but they are now a farce, as a succession of spivs and shysters abuse them to make sure the mess these scumbags make don't financially impact themselves. They can just start another company and/or phoenix the old business with impunity.

[CraigDS]

Seems Patisserie Valerie has been saved via two £10m loans from the majority owner.

Regis UK, which owns 220 hair dressers in the UK is trying to use a CVA to lower rents.

[ShakaHislop]

Claire's 'considers UK store closures'

The news comes days after Claire's US parent company emerged from bankruptcy protection.

The bankruptcy protection procedure in the US - known as Chapter 11 - is aimed at giving companies time to restructure their finances.

https://www.bbc.co.uk/news/business-45864449

[Nobby Reserve]

Meanwhile, US retail giant Sears has filed for Chapter 11 bankruptcy protection amid a mountain of debt and falling revenues.

The group employs 70,000 staff, operates over 700 stores, and has been a dominant player in US retail for decades. It's announced the closure of a further 142 stores, on top of 46 already announced.

[Lush is the best medicine...]

Meanwhile, US retail giant Sears has filed for Chapter 11 bankruptcy protection amid a mountain of debt and falling revenues.

The group employs 70,000 staff, operates over 700 stores, and has been a dominant player in US retail for decades. It's announced the closure of a further 142 stores, on top of 46 already announced.

no shock those stores were massively dated so no surprise they have gone that way

[ShakaHislop]

Gourmet Burger Kitchen earmarks 17 stores for closure

Gourmet Burger Kitchen (GBK) says it has earmarked 17 restaurants for closure after running up millions of pounds of losses.

The chain, owned by South Africa's Famous Brands, has filed for a Company Voluntary Arrangement - an insolvency process that allows struggling firms to close unprofitable stores.

It warned 250 jobs were at risk under the plan, which still needs approval.

GBK operates around 80 restaurants in the UK and employs 2,000 people.

Earlier this month, Famous Brands said GBK had booked a £47m loss amid tough trading conditions.

https://www.bbc.co.uk/news/business-45962981

[killer-heels]

Debenhams set to announce a £500m loss. Ouch.

[CraigDS]

New Look have closed 85 stores since March, with a further 13 facing closure and 26 currently being operated rent free (can be ended at any point by either party).

Allied Healthcare, who provide services to around 13,000 people across the UK, also in a bit of trouble it looks like.

[Lush is the best medicine...]

Boohoo and the like ruined new look

[ShakaHislop]

House of Fraser to shut another four stores

The department store chain, bought out of administration in August by Mike Ashley's Sports Direct, will shut its Lakeside, Metrocentre, Norwich and Nottingham outlets in the New Year.

Mr Ashley said the landlord, Intu Properties, had been unwilling to reduce rents for the ailing shops.

He added that there had been "multiple meetings with Intu".

"We were no further forward after 14 weeks. Unfortunately, these stores now face closing in the New Year. I urge other institutional landlords to be more proactive to help save the HoF stores in their schemes," he said.

Intu confirmed it had been unable to reach an agreement with Mr Ashley.

"House of Fraser stores in our portfolio will be closing in early 2019, representing around 1% of our secured rent and 526,000 sq ft of retail space.

"We are enthusiastic about the opportunity to re-engineer and re-let this underperforming space to new and exciting alternatives."

After buying House of Fraser in August, Mr Ashley said he was hopeful that most of the department store chain's 59 sites would remain open.

He has so far done deals to save at least 20 stores, safeguarding about 3,500 jobs, but at least eight are closing.

https://www.bbc.co.uk/news/business-46209147

[CraigDS]

Those are big spaces they'll be looking for stores for, which in the current market place could well take a while to find. High streets will suffer for it no doubt.

[FlashGordon]

Those are big spaces they'll be looking for stores for, which in the current market place could well take a while to find. High streets will suffer for it no doubt.

Surely with all these closures and seemingly no new business ready to take up the slack landlords are going to have to agree to some concessions on rent prices? It's all a bit cutting off your nose to spite your face.

[CraigDS]

Yeah it seems a little short sighted from landlords, but then I guess we've not see whats on offer. I know HoF have agreed rent free deals with some stores and a cut of the profits for the landlords.

[Brissyred]

Surely with all these closures and seemingly no new business ready to take up the slack landlords are going to have to agree to some concessions on rent prices? It's all a bit cutting off your nose to spite your face.

I wanted to move my two business's together under one roof rather than the two locations I have now. The idea was to consolidate space wise and share a reception, goods outwards, fork lift etc, etc.
I found a suitable building and made inquiries with the real estate people, it turned out that the building had been empty for eight months and the rent was more expensive than the combined rents of my current locations.
The asking price was $30k/month, I made an offer of $26k/month which is equal to my current rents combined. The offer was refused and the building is still empty 18 months later. I found it inconceivable that the landlord would be prepared to lose so much money.
I have since found out that with commercial property the value of the building is primarily based on the rental value and even if it's standing empty with a large rent it's more valuable than something with cheaper rent and 100% occupancy. If the landlord has leveraged loans based on the value of the building and subsequently leases it for less the buildings value will be re-assessed and the loans may be called in by the bank. If the owners can continue without the revenue from the building it may be better to leave it empty than reduce the rent.

[Trada]

Front page of today's FT.

[ShakaHislop]

Front page of today's FT.

On Monday, Interserve was awarded a new £25m Welsh public sector contract to help in the redevelopment of Prince Charles Hospital in Merthyr

Really?! 

https://www.bbc.co.uk/news/business-46505688

[ShakaHislop]

November shopper footfall 'worst since recession'

The number of people out shopping in the UK in November dropped to its lowest level since the 2008 recession, retail researchers say.

Footfall at shopping centres, retail parks and High Streets fell 3.2%, according to analysis firm Springboard.

The figures showed the Black Friday effect was driving more shopping online during a longer period, the firm said.

The decline was "indisputable evidence" that Black Friday was of no benefit to physical stores, it added.

Springboard said it expected footfall to decline by 4.2% year-on-year in December, a bigger drop than the 3.5% decrease seen in December 2017.

"These figures are the worst footfall figures that Springboard has recorded since the recession and we're not actually in recession," said Diane Wehrle, Springboard's marketing and insights director.

"It's clear that something significant is happening out there in consumer demand. It has really railed back this year."

https://www.bbc.co.uk/news/business-46502650

[CornerFlag]

https://www.theguardian.com/business/2018/dec/16/jaguar-land-rover-to-axe-up-to-5000-jobs

Jaguar Land Rover to 'axe up to 5,000 jobs'

Analysts say carmaker will outline job cuts in new year as part of drive to combat Brexit and falling sales


Jaguar Land Rover is planning to announce thousands of job cuts in the new year as part of a £2.5bn savings plan to ward off the threat from Brexit, falling sales in China and a drop in demand for diesel cars.

Britain’s biggest carmaker employs 40,000 in the UK and has already cut 1,000 temporary contract workers at its plant in Solihull, which builds Range Rovers and the Land Rover Discovery SUV. It has also reduced working hours for some workers, including at its Wolverhampton factory in the run-up to Christmas.

Plans for further job cuts come after the firm, which is owned by the Indian conglomerate Tata and is a major employer in the West Midlands, made a £90m loss in the three months to September, hit by falling sales in China and Europe.

In an attempt to turn around its ailing fortunes the company announced plans in October to save £2.5bn, including £1bn of cost cuts, but did not say how many jobs would be lost. However, according to a report in the Financial Times, several people close to the carmaker said JLR will outline in January the short-term element of its plan, including the loss of up to 5,000 jobs.

Tata Motors has appointed Boston Consulting Group to put together the turnaround plan. The carmaker said: “Jaguar Land Rover notes media speculation about the potential impact of its ongoing charge and accelerate transformation programmes.

“As announced when we published our second-quarter results, these programmes aim to deliver £2.5bn of cost, cash and profit improvements over the next two years. Jaguar Land Rover does not comment on rumours concerning any part of these plans.”

The plan to revive the fortunes of the luxury carmaker includes a reduction in annual investment from £4.5bn to £4bn this year and next, and a reduction in the stock of finished cars it holds and its working capital by £500m. It will also cut £1bn in costs. and has already introduced a freeze on recruitment and all non-essential travel, as it battles falling demand.

The union Unite said government policy on diesel and its “botched” handling of Brexit was weighing on the hard work by staff at Jaguar Land Rover, “the jewel in the UK’s manufacturing crown”.

The spokesman added: “Unite is not aware of any further job losses to those already announced and planned for early in the new year at Jaguar Land Rover, Unite also expects ongoing transparency regarding the difficult current climate the automotive sector is operating in the UK and its impact with the company.

“Unite will continue to press the carmaker for assurances over the jobs and skills of our members who have worked tirelessly over the past decade to make the company the global success story it is today.”

thisisfine.jpg

[ShakaHislop]

Laura Ashley to close 40 UK stores amid a push into China

https://www.bbc.co.uk/news/business-46588294

[Lush is the best medicine...]

ASOS profit warning has fucked retail on the markets

[killer-heels]

HMV to enter administration again.

https://www.bbc.co.uk/news/business-46699290

[Gerry Attrick]

HMV to enter administration again.

https://www.bbc.co.uk/news/business-46699290

Not remotely surprising. Their pricing is absurd comparative to services like Netflix. It's tough to sell DVDs for 6 quid a pop when you can pay that and watch as many as you want online for a month.

[Riquende]

I have no idea why anyone thought HMV could be saved last time. I haven't bought a CD or DVD for maybe 10 years now.

[rob1966]

I have no idea why anyone thought HMV could be saved last time. I haven't bought a CD or DVD for maybe 10 years now.

I still like to own the physical item so still buy CD's. With Amazon you get the digital download too. I actually did buy a couple of Slipknot CD's from HMV in the summer, but because the shop is in the Trafford Centre I'd rather not go there and I have no interest in going into Manchester city centre either.

As a kid I was always in and out of the HMV in town, as well as Probe, getting my vinyl. Modern life is killing the shops and we are all guilty of their demise.

[Riquende]

I still like to own the physical item so still buy CD's.

I do appreciate that is still the case for lots of people. Personally, I actively don't want the physical item. I've got a small house and given the volume of music I have available (not through streaming) I'd have to have half a room dedicated to shelving for CDs, DVDs etc. Instead of that, I can have it all stored in a small box sitting in the corner of the living room, and thanks to the magic of Plex et al I can access it from every room and even when I'm sat in someone else's house (if they have the right hardware themselves, which nowadays is very likely).

A generation will be growing up soon that will never have owned CDs, and won't miss them. The high street has to adapt to that.

[killer-heels]

I do appreciate that is still the case for lots of people. Personally, I actively don't want the physical item. I've got a small house and given the volume of music I have available (not through streaming) I'd have to have half a room dedicated to shelving for CDs, DVDs etc. Instead of that, I can have it all stored in a small box sitting in the corner of the living room, and thanks to the magic of Plex et al I can access it from every room and even when I'm sat in someone else's house (if they have the right hardware themselves, which nowadays is very likely).

A generation will be growing up soon that will never have owned CDs, and won't miss them. The high street has to adapt to that.

Oh the high street will adapt. It will adapt by having a Costa Coffee (or several) and a massive Amazon store.

The high street is dead. We will be living in baron towns pretty soon.

[Red Beret]

Not remotely surprising. Their pricing is absurd comparative to services like Netflix. It's tough to sell DVDs for 6 quid a pop when you can pay that and watch as many as you want online for a month.

They've gone a bit like Woolies.  They key products, like DVDs and games have become increasingly irrelevant in the downloadable universe; they've tried to diversify a bit into hardware, but other specialist shops do that better than them.  It's hard trying to be a jack of all trades in such an unforgiving environment.

[Iska]

The high street is dead. We will be living in baron towns pretty soon.

What’s a baron town?

Where I live the (huge mall) town centre has always been somewhat polarised - bookies and primark at one end, m&s and brand shops at the other - but in 2018 the shops in the middle have been going bust one after the other.  There’s now about a sixty-yard dead zone in the middle where hmv and Superdrug are the last shops left open.  It looks pretty stark but I suppose is a useful metaphor for what’s happening to the high street.

[Lush is the best medicine...]

What’s a baron town?

Where I live the (huge mall) town centre has always been somewhat polarised - bookies and primark at one end, m&s and brand shops at the other - but in 2018 the shops in the middle have been going bust one after the other.  There’s now about a sixty-yard dead zone in the middle where hmv and Superdrug are the last shops left open.  It looks pretty stark but I suppose is a useful metaphor for what’s happening to the high street.

think she means barren not a town filled with monocle wearing toffs

[Iska]

think she means barren not a town filled with monocle wearing toffs

Hahaha - it put me in mind of baronies, rotten boroughs and various other archaic terms, and I thought a ‘baron town’ might actually be a thing.  ‘Barren’ though, yeah that I can see.

[Lush is the best medicine...]

Hahaha - it put me in mind of baronies, rotten boroughs and various other archaic terms, and I thought a ‘baron town’ might actually be a thing.  ‘Barren’ though, yeah that I can see.

one thing actually about that mall, how has there not been a puregym or one of those going in there, can definitely see more bigger units becoming gyms/pt spaces, which isn’t such a bad thing

[Iska]

one thing actually about that mall, how has there not been a puregym or one of those going in there, can definitely see more bigger units becoming gyms/pt spaces, which isn’t such a bad thing

That actually is another trend I’d noticed, there’s an oversupply of office property nearby and they are slowly becoming puregyms and the like.  It seems to be working for them, they’re way busier than I’d’ve thought.  It might be it doesn’t work in a mall though, as they’re then at the mercy of the owners when it comes to early/late opening.  Malls generally might be wastelands waiting to happen, actually, if they try to stay retail-only.

[Lush is the best medicine...]

That actually is another trend I’d noticed, there’s an oversupply of office property nearby and they are slowly becoming puregyms and the like.  It seems to be working for them, they’re way busier than I’d’ve thought.  It might be it doesn’t work in a mall though, as they’re then at the mercy of the owners when it comes to early/late opening.  Malls generally might be wastelands waiting to happen, actually, if they try to stay retail-only.

im a member of the gym and one of the ones I use is an office building where they have a floor, some others are on sites which I think were more for industrial purposes. If it’s an area where there is a high concentration of offices, especially on an out of town/airport site I can imagine it’s pretty busy as you’ve got a large clientele on your doorstep, many who want to go to the gym (and of course those who sign up and have that £20 a month taken out of their account but never go )

I know in North America from my travels there I’ve seen a few malls where it looks like the main anchor tenant (at least on one side) is a gym and they have their own front entrance where they can have their own opening hours and shut the mall entrance if it’s possible to enter from the mall. I do think the smarter mall owners are trying to shift from a pure retail to more dining options to make it more of an ‘experience’ than just shopping which is smart, but for smaller malls it’s probably not a viable option

[CraigDS]

Was always a matter of time for HMV. Demand for physical media has always been dwindling, profit on them small, and with the costs of running a store high. Probably needed to move more into the digital services space, but then they would have had some major competition which probably would have still seen them off anyway.

[killer-heels]

Was always a matter of time for HMV. Demand for physical media has always been dwindling, profit on them small, and with the costs of running a store high. Probably needed to move more into the digital services space, but then they would have had some major competition which probably would have still seen them off anyway.

Basically people don't want to own things. Seeing as they cannot afford a house, why have 'stuff'?

Its fine though. Society will be just fine sitting indoors, watching netflix, getting offended by everything, being monitored, getting their groceries delivered and talking to Alexa.

[CraigDS]

The thing is owning ‘things’ can be a fucking pain. I’ve about 300 DVDs which I’ve taken to 3 houses and never unpacked. I’d rather pay to watch them in HD or 4k if I want to watch them. It makes sense for me to not have as much stuff.

That’s not to say having some stuff isn’t desirable still, but it def makes absolute sense for some things (media being one) to be digital.

[killer-heels]

The thing is owning ‘things’ can be a fucking pain. I’ve about 300 DVDs which I’ve taken to 3 houses and never unpacked. I’d rather pay to watch them in HD or 4k if I want to watch them. It makes sense for me to not have as much stuff.

That’s not to say having some stuff isn’t desirable still, but it def makes absolute sense for some things (media being one) to be digital.

I can understand people not wanting DVD’s. Music and books though I cannot.

[CraigDS]

I can understand people not wanting DVD’s. Music and books though I cannot.

Same thing though. Some appreciate the content of an album or book more than having them physically. My missus adores books, but would happily have her phone full of music rather than CDs.

Personally I’m happy with digital versions of them all.

[So… Howard Philips]

Same thing though. Some appreciate the content of an album or book more than having them physically. My missus adores books, but would happily have her phone full of music rather than CDs.

Personally I’m happy with digital versions of them all.

Could never consider digital books.

All my music is now digital but I can get really nostalgic, even tearful, seeing an album cover. I saw a copy of Atlantic's 1968 "This is Soul" and was immediately taken back to being 16.

Will you get that from iTunes?