Discount retailer in administration
DISCOUNT retailer Hitchens has been put into administration by its struggling parent company Wallgate.
The chain was founded in Yorkshire as MC Hitchens in 1926 but was sold by the founding family in the 1980s. It now has a shop in Sheffield and 12 others, mainly in the North West.
According to a statement by Wallgate, Hitchens has endured months of poor sales and was losing money. The group said it had “reluctantly” made the decision in a bid to cut overheads and give it a better chance of survival.
Wallgate also admitted that it needed £1m by November 28 to continue trading. It plans to launch a “deeply discounted” share issue to raise £1-1.5m.
The cash is need for working capital to pay creditors and fund stock. It also wants to take advantage of distressed stock situations in the run up to Christmas.
The decision to put Hitchens into administration leaves Wallgate with its online trading divisions, Hot Deals and Best Price Trading, and two electrical shops in Nottingham and Runcorn.
In a statement the AIM-listed business said: “The company believes that demand for discounted electrical products from its wholesale division remains strong and that it has a robust business model for the source and supply of such products.
“Furthermore, the company believes that the current economic conditions are conducive to the creation of opportunities for the purchase of distressed stock at discounted prices.”
The group also announced the resignation of chief executive John Taylor.
