Sir Philip Green's company hit with £26.4m bill for BHS fallout

Helen Cahill
Follow Helen
Fashion For Relief - Front Row - The 70th Annual Cannes Film Festival
Green paid a substantial sum to the BHS pensioners in February (Source: Getty)

Sir Philip Green's holding company Taveta Investments has been hit with a £26.4m bill due to the collapse of BHS.

According to accounts filed on companies house, Taveta faces £129.2m in one-off costs for the year ending 27 August, and just over a fifth of this bill was attributable to BHS falling into administration.

Read more: Green suffers profit hit as he drafts in McKinsey to save online sales

Green has had to pay substantial legal and advisory fees throughout the BHS saga, and, separately, had to pay out £363m of his own personal money to BHS pensioners to plug the hole in the BHS pension scheme.

The Taveta report said that Green does not expect to have to deal with any more action from the Pensions Regulator, which threatened to impose a contribution notice on Green if he did not pay up.

The other brands in his retail empire have also been struggling due to the increasingly tough trading environment on the high street. UK turnover for Green's brands, which include Topshop and Evans, fell to £1.7bn from £2.2bn for the prior year.

Read more: These are the 20 companies Brits most want to work for

Company secretary Michelle Gammon wrote in Taveta's strategic report: "The group is aware that its customers continue to face testing times driven by challenging economic conditions.

"The current retail environment is very challenging as competitors seek to attract value-conscious customers using a variety of routes to market. Failure to keep pace with the changing retail environment would adversely impact on the group's profitability."

In addition, the report highlighted the problems raised by the uncertainty of Brexit, and slowing wage growth in the UK, which has been squeezing consumer spending as inflation bites.

Read more: Retail sales slide as consumers cut discretionary spending

"This, in addition to the ongoing volatility in currency markets, means the outlook is unclear," Gammon wrote.

To ameliorate an increase in costs from sterling's devaluation, the firm will aim to improve its margins, the report said.

One of the greatest challenges faced by the group is the growth in online retail; it has 39 desktop websites to manage, and 28 mobile sites.

To help make sure the firm keeps up with its customers' needs online, Green has drafted in consultancy firm McKinsey & Co to shake-up his fashion empire's offering.

Related articles