New Look has requested a three-month rent holiday from landlords, alongside other immediate actions to mitigate the economic impact of coronavirus.
The retailer has taken other proactive measures including significantly reducing marketing costs, pausing all production, delaying all significant Capex projects and halting recruitment.
New Look has confirmed it is actively pursuing government support including a business rates exemption for 12 months, employee cost support, deferral of tax and national insurance payments, and gaining access to the Covid Corporate Financing Facility.
The update comes after Drapers revealed that New Look has put a halt on all current and future production, and is offering thousands of employees unpaid leave in order to ease the impact of the coronavirus outbreak.
The retailer made the decision to close all 480 UK stores on 21 March, and all 28 stores in the Republic of Ireland on 20 March. This was prior to the government’s announcement that all non-essential stores should close in an attempt to slow down the spread of the virus.
Chief executive Nigel Oddy said: “Our absolute priority is to keep our customers and colleagues safe, which underlined our decision to temporarily close our stores in advance of government advice to do so. Given the unprecedented circumstances that we – like all retailers – are operating in, we have taken a range of decisive and immediate actions to help us navigate through the coming period.
“We are confident that a combination of these ongoing actions, the significant financial and operational progress we have made over the past two years with our turnaround plan, and the strength of our brand mean that we will be well-positioned to return to growth when a more normalised operating environment resumes.”
New Look noted that it “entered the Covid-19 outbreak with strengthened liquidity”, having completed its financial restructuring in May 2019. It confirmed it has no near-term maturities on its long-term debt funding which matures in 2024 and “has the ability to toggle cash interest to PIK [Payment-In-Kind] to provide additional debt servicing flexibility.”
- Read our interview with Nigel Oddy on his plans for the business