Troubled young fashion retailer Blue Inc was struck by mounting losses in the months before it filed for a company voluntary agreement (CVA).
Blue Inc’s losses totalled £15.6m in the 18 months to 2 July 2016, plummeting from a £2.61m loss during the 18 months ending 30 December 2014.
The retailer posted £23m in sales and £12m in gross profit during the 18-month period, according to its latest accounts filed with Companies House.
However, it held a net liabilities position of £13.4m, in contrast to £1.4m in net liabilities in the comparable timeframe to the end of 2014.
Blue Inc’s directors estimated the CVA in March released around £9m in debt obligations. One of its main creditors, Padma Textiles, was paid £2.2m to “secure the continuing supply of goods”.
Hezi Yechiel and Miraj Khan from Padma Textiles are now joint chief executives at Blue Inc, after Padma Textiles and MAF Clothing took a majority share of the firm in December.
The company said in the filing that one of its key risks is the “highly competitive market”, adding that it will seek to manage this risk by “offering unique designs, competitive pricing and providing a high level of customer service”.
Blue Inc filed for a CVA in March to enable it to shut unprofitable stores and reduce rents. This move was made just over a year after one of the retailer’s subsidiaries went through a pre-pack administration.
At the time of the CVA the retailer outlined plans to close 34 of its 127 stores. The proposals were approved by more than 80% of its creditors.