Jessops woes back in focus

PHOTOGRAPHIC retailer Jessops yesterday saw its stock plunge 63 per cent after shareholders were warned they would probably end up with nothing, as the company battles falling sales and its debt pile.<br /><br />The company reported half-year pre-tax losses of &pound;6.3m for the six months to 31 March, while like-for-like sales were down 4.4 per cent.<br /><br />Executive chairman David Adams insisted the camera specialist had a future on the high street, but warned that shareholders would be wiped out when it finalised plans to restructure its &pound;60m debt.<br /><br />&ldquo;Against the backdrop of the challenging retail environment and the historic level of debt, the board believes that it is unlikely that any value will be attributed to shareholders,&rdquo; he said.<br /><br />Since retail veteran Adams was parachuted into the struggling group in 2007, he has sought to turn around the business and has secured lending from HSBC. In June 2007 HSBC agreed to lend Jessops &pound;66.5m until December 2008, allowing the company to reposition its business.<br /><br />Adams said the banks had now committed medium and long term support, but added the group was still discussing a fundamental restructuring of its &pound;60m debt.<br /><br />The group has already shut 100 stores and axed 125 employees, and yesterday warned that future redundancies were likely.&nbsp;Even before the downturn, Jessops&rsquo; trading performance had been hit by an increase in competition from supermarkets and online retailers. Its shares closed at 2.43p.