Carpetright has posted a full-year loss warning some suppliers withdrew stock as it went through a “difficult” trading period.
The company said it made a loss of £70.5m for its financial year to 28 April 2018 compared with a profit of £900,000 in the same period a year ago.
Carpetright has already said it will close 92 stores, cut 300 jobs, and raise new money as it fights for survival.
The beleaguered retailer has won approval from creditors to restructure its business, including slashing the rents on 113 struggling stores.
Chief executive Wilf Walsh said: “After a difficult trading year impacted by reduced consumer spend, increased competition and the legacy of an unsustainable, over rented store portfolio – the CVA (Company Voluntary Arrangement) and recapitalisation offers us the chance to rebuild Carpetright which remains the clear market leader in floor coverings with outstanding consumer brand awareness.”
A number of retailers have used CVAs to reduce their debts, including House of Fraser, New Look and Toys R Us.
But the company warned like-for-like sales in the UK remained “negative” and some suppliers had withdrawn stock.
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“As expected, trading in the first eight weeks of the new financial year was heavily impacted by the disruption arising from the Group’s restructuring activity, in particular stock shortages as some suppliers had withdrawn supply, and the period of exceptionally warm weather,” the company said.
Carpetright, which has seen its stock plunge more than 80% over the last 12 months, said it made an underlying pretax loss of £8.7m.
Source: Sky