High street supplier Visage Group, which is owned by supply group Li & Fung, reported a 46.8% decrease in turnover to £99m for the year to 31 December 2018, but reduced its operating losses by 13%.
The company said the drop in turnover was a result of the “tough clothing retail market”.
Visage, which has its head office in Salford, Greater Manchester, designs and produces women’s, men’s and childrens’ wear for high street retailers and etailers, which are understood to include Asos, New Look, Dorothy Perkins and Next.
During the second half of the year, it restructured operations to focus on its customers that are “more financially secure and are performing more strongly in the marketplace”. As a result, it made 120 redundancies during the period.
Visage said: “The restructuring resulted in a reduction in staff numbers from 236 to 116, significantly changing the operating model and cost base of the business. The company believes this strategy and change in operating model has placed it in a strong position to stabilise the business to growth in 2019. These changes resulted in one-off severance costs of £1.2m.”
In the same period, losses reduced from £19.7m to £16.3m, while operating losses fell from £18.7m to £16.3m.
Meanwhile, the total shareholders’ deficit grew by 482.7% from £3.3m in funds in 2017, to a deficit of £13m last year.
Li & Fung entered into an agreement to buy UK private label supplier Visage Group to expand its reach in Europe in February 2010. Hong Kong-based Li & Fung said at the time that it would pay up to £173m for Visage using cash reserves to fund the acquisition, adding that the purchase would provide: “a substantial platform and suitable infrastructure for the future development of the Group’s apparel business in Europe.”