Monday 21 January 2019 7:45 am | Updated: Monday 03 June 2019 3:23 am

Patisserie Valerie keeps shareholders in the dark on future as last ditch talks with banks continue

Patisserie Valerie’s holding company has failed to shed further light on the future of the troubled bakery chain after announcing this morning talks were still ongoing with its creditors to save the company.

The firm was expected to provide an update this morning, after speculation the last week of talks with its banks could spell the end of the high street cafe brand, but instead told shareholders talks would continue this week.

“Patisserie Holdings announces today that, further to the announcement on 16th January, the Company is still in discussions with its bankers to extend the standstill of its bank facilities beyond 18 January and will issue an update when those discussions have concluded,” it said in a new update.

Entrepreneur Luke Johnson, Patisserie Valerie’s leading shareholder, is looking to extend a standstill on its bank facilities which expired officially on Friday.

If he does not reach an agreement with lenders HSBC and Barclays, they could demand Patisserie Valerie repay its debts, potentially forcing the company into administration.

The cafe chain has managed to cling on, partially thanks to an emergency loan from its chairman Luke Johnson. It has hired KPMG to explore “all options” to keep the firm alive.

The company posted a bombshell update on Wednesday, admitting that its balance sheet was “significantly” manipulated and thousands of false entries were made into the high street baker’s books before a shock £40m black hole was discovered last year.

The troubled firm has appointed RSM as auditors alongside KPMG to help it recover from the effects of the “devastating” fraud.

In a statement the company said on Wednesday the “the cash flow and profitability of the business has been overstated in the past” and is substantially lower than the figures announced in its last trading update on 12 October.

News of the black hole originally emerged last autumn.

“The work carried out by the company's forensic accountants since then has revealed that the misstatement of its accounts was extensive, involving very significant manipulation of the balance sheet and profit and loss accounts," the firm said in a statement.

“Among other manipulations, this involved thousands of false entries into the company's ledgers. It will take some time before a reliable trading outlook can be completed while the above work streams progress.”

The company has also hired a new chief executive, interim chief financial officer, non-executive director, commercial director and production director.