Ann Summers warns landlords over potential CVA
Lingerie chain Ann Summers has warned landlords that it will launch a restructuring process if the retailer is unable to reach an agreement on rents.
The high street retailer said it is mulling a company voluntary arrangement (CVA) to switch to turnover-based rents due to changing consumer behaviour during the coronavirus pandemic.
The firm benefitted from a surge in demand during the coronavirus lockdown, meaning the company expects to improve upon the £16m loss it recorded last year.
However the acceleration of the shift to online shopping during the coronavirus pandemic has forced bricks and mortar retailers to adapt.
Ann Summers chief executive Jacqueline Gold said many landlords had been “sensible” and “open to negotiation”.
However she said some “continue to bury their heads in the sand when it comes to these discussions”.
“I’m grateful to those landlords who have engaged in constructive discussions with us and should we carry out a CVA they will definitely not be compromised,” Gold said, writing in trade magazine Retail Week.
“To those who haven’t yet, there is still time to come to the table.
“It is a shame we have to threaten a CVA in order to do this, but this is no idle threat.”
Gold also revealed that her family had ploughed large sums of money into the business last year.
“These are long-term, possibly permanent, changes and they mean that landlords must take a more pragmatic approach to rents,” Gold said.
Ann Summers joined a group of retailers to write to the Treasury in February this year, calling for it to take action on business rates, which they said had “come unsustainable for many retailers”.