Laura Ashley one of Britain’s largest fashion and home retailing giant has to struggle as its profits slump. The company had told that its profits have gone down by 10%. The news of the company is not good on the stock market either. The shares of the company have slumped by 41%.
Under such circumstances the company has asked for more money from its lenders so that it can continue to trade. The representatives from the company have told that if it is unable to get the requisite level of money then it may have to “consider all other appropriate options”.
The trading of the shares has gone down as the company reported a net loss of 11% at the end of last year. The company will have to deal with further challenges as it tries to stay afloat in the tough and competitive UK’s fashion market.
The reasons behind such turn of fortunes for the firm are weak consumer spending and the change of consumer buying behaviour which the firm could not adhere to.
Due to this the sales of the company had started to weaken and the sales of the more expensive items have almost stagnated. The majority share holder of the British fashion designer firm is MUI a Malaysian business group.
The deposits of the customers have shrunk as many people had opted to sell their shares. Thus the company can apply for a lesser amount of loan from US corporate bank Wells Fargo than what it could have.
MUI is expected to talk to the representatives from Wells Fargo about the funding. Officials believe that in order to turn the tide the company needs to have a robust plan and must adjust to the consumer tastes or else the sales figures will not increase.
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