Loss-making pet products group set for administration

Just for Pets

A loss-making pet products supplier based in the Midlands is on the verge of administration putting scores of jobs at risk.

Worcestershire-based Just for Pets is set to be placed in administration by its parent, agricultural supplies group, Wynnstay.

Just for Pets operates 25 shops, with the bulk of them in the Midlands – especially its Worcestershire heartland.

In a statement to the markets, Wynnstay said: “The trading environment for JfP has shown a marked deterioration over the last year. Changes in consumer buying behaviour, coupled with additional sources of competition and greater cost pressures, have placed an increasing strain on the business and the subsidiary has become loss-making.

“It became increasingly clear that restructuring measures were required and, as announced in the company’s half year results on June 21, 2017, a review of the options for the business was commenced and the company recognised a goodwill impairment charge of £3.89m in relation to JfP.

“Following a careful and extensive consideration of alternative solutions, including a sale of the business, the difficult decision has been taken to give Notice of Intention to Appoint Administrators to the Just for Pets business.”

Wynnstay said it intended to work alongside advisers to preserve as much value as possible for all of the JfP stakeholders, including its employees, customers, suppliers and Wynnstay shareholders.

For the six months to April 30, 2017, Hartlebury-based JfP generated £7m of revenues, approximately 3% of Wynnstay’s total revenues for the period, and an operating loss of £0.25m. The company’s total adjusted operating profit for the same period was £4.24m. Current segmental net assets relating to JfP totalled approximately £2.2m.

Management said it expected to recognise exceptional charges relating to the write-off of net assets and associated costs.

Wynnstay shares closed more than 2.4% down following the announcement.

Ken Greetham, chief executive of Wynnstay, said the decision to file the notice had been a difficult one.

“Having thoroughly investigated and pursued other options, it has been concluded that this was the correct path to take, both for Just for Pets and Wynnstay, given the difficult circumstances in which JfP has found itself in recent years,” he said.

JfP operates stores in Bromsgrove, Burton-upon-Trent, Coventry, Droitwich, Evesham, Kidderminster, Long Eaton, Malvern, Maypole (Birmingham), Northampton, Northfield, Nottingham, Nuneaton, Stourbridge, Swadlincote, Telford, Wellington, Wolverhampton, Worcester and Yardley.

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