NEW LOOK said yesterday it had won extra time from its banks to pay back its burgeoning debt pile as the fashion chain slumped to a £55m pre-tax loss for the year.
The retailer, owned by founder Tom Singh and private equity groups Apax Partners and Permira, said its lenders had agreed to extend its debt repayment from 2013 to 2015, giving it the breathing space “to focus on strategic objectives and growth”.
New Look, which makes cheap and cheerful clothing aimed at under 35s, said its net debt remained at £1.1bn and it had £212m of cash at the end of the year, up from £191m. It plans to use £100m of its cash to pay back some of its debt owed next year.
Chief executive Alistair McGeorge, who was parachuted in last year after the retailer pulled its planned flotation, said New Look was facing “significant internal disruption” when he arrived and it had “alienated” certain customers with its ranges.
“All this meant we had undermined our competitiveness on the high street,” he said.
The group plans to close between 50 to 100 stores over the next three to five years to cut costs as it migrates more of its sales online.
The move comes as a number of embattled high street retailers look to renegotiate more favourable deals with the landlords.