Beales collapses into administration, but continues trading for the time being

Department store chain Beales, which has outlets in Southport and Kendal, has appointed KPMG as administrators after failing to find a buyer or new investment for the business.

The Bournemouth-based retailer began trading in 1881 and has 22 shops.

It desperately sought a rescue deal earlier this month, but its failure means more than 1,000 jobs are now at risk.

However, the chain will continue to trade in the meantime while administrators consider their options.

KPMG said: “Despite interest from a number of parties, this process did not secure any solvent solutions for the company, and as a result, the directors took the difficult decision to place the companies into administration.”

In October 2018, the group chief executive, Anthony Brown, completed a management buyout of the business.

But last month, on December 17, it announced the business was up for sale, saying it was assessing a number of strategic and financing options available to the company: “These options include, but are not limited to, assessing a potential sale of the company and its subsidiaries, including J E Beale plc.”

It is believed two suitors – another retail firm and a venture-capital investor – were interested in purchasing the business.

The firm was also negotiating with its landlords to try and agree rent reductions.

Its latest accounts showed that pre-tax losses more than doubled to £3.2m in the year to March 2019 from £1.5m a year before, while revenues remained static at £48.3m. The business had net current debts of £15.8m.

In those latest accounts Beales said that trading had been hampered by an industry-wide downturn in sales of women’s fashion and the 2018 Summer heatwave.

KPMG’s Will Wright, who is the joint administrator to Beales, said: “With the impact of high rents and rates exacerbated by disappointing trading over the Christmas period, and extensive discussions around additional investment proving unsuccessful, there were no other available options but to place the company into administration.

“Over the coming weeks, we will endeavour to continue to operate all stores as a going concern while we assess options for the business, including dealing with prospective interested parties.”

He said added that during this period gift vouchers, customer deposits and customer returns/refunds will continue to be honoured.