Ann Summers calls in advisers after £3.3m loss

Lingerie retailer, Ann Summers, has announced it has appointed a property adviser in order to help with rent reductions, after a £3.3m loss last year replaced a £2.9m profit in the year previous.

The retailer blamed rising store costs along with the fall of sterling due to Brexit, which it says has raised sourcing costs. Reports in The Times suggested that CWM had been the firm hired to help Ann Summers consider options for its 106 stores, which could include a CVA.

A property industry source told The Guardian: “Ann Summers are going about this in the right way, but if they don’t get the rent reductions they will probably pursue a CVA.”

Jacqueline Gold, the CEO of Ann Summers, which employs 1,250 people, said the retailer had seen a “difficult year” during 2018. The CEO said that investment in a new look for the brand, business taxes and high sourcing costs. Gold added that the devaluation of sterling following the Brexit vote had eroded profit of £1.5m.

In a notice to the retailers accounts, Gold said: “As with all retailers, we face the disproportionate burden of business rates on our stores … that threatens our high streets, unlike the pure-play brands and online giants whose competitive advantage remains unchallenged.

“Employment costs have escalated by £0.5m, caused by a combination of [the] ‘national living wage’, pension contribution ratchets and the apprenticeship levy. Whilst the sentiment of these increases might be right, the impact of all these changes imposed at once … means that we are simply burdened by more and more unaffordable taxes.”

An Ann Summers spokesperson, said: “As a leading retailer operating in the current retail climate, we are constantly striving to secure the most cost-effective and responsible ways of working. This includes working with a property agent on our existing portfolio as well as new sites that we hope to secure in the near future.”