Clothing Brand Struggles Amidst High Street Challenges
- Select Fashion on the verge of collapse
- 35 stores set to close
- No redundancy payouts for staff
- Entering Creditor’s Voluntary Liquidation (CVL)
- Owed £53.1m to creditors in 2019
- High street conditions blamed for failure
Select Fashion is reportedly on the verge of collapse, with 35 stores set to close and staff not receiving redundancy payouts. The company has drafted in advisers from Moorfields to oversee the liquidation process. Directors agreed to a Creditor’s Voluntary Liquidation (CVL) due to its inability to repay debts. In 2019, Select Fashion entered into a Company Voluntary Arrangement (CVA) with Moorfields, which allowed it to continue trading by negotiating debts. The retailer filed for administration in May 2019, reporting a loss of £15.5m on sales of £117m in the 18 months leading up to December. At that time, Select had only £1m in the bank and £2.8m worth of stock. Quantuma, who oversaw administration, blamed ’prevailing high street conditions’ for the failure to execute a turnaround plan. Select Fashion is not the only fast-fashion group facing collapse; Quiz also closed 23 stores this year due to ongoing trading challenges.
Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about Select Fashion’s financial situation and its decision to enter into a Creditor’s Voluntary Liquidation (CVL). It cites relevant sources such as The Sun and Companies House for its information. While it mentions the closure of stores and potential job losses, it does not include any digressions or personal opinions.
Noise Level: 4
Noise Justification: The article provides relevant information about Select Fashion’s financial situation and its decision to enter into a Creditor’s Voluntary Liquidation (CVL). It also mentions the company’s previous administration in 2019 and the challenges faced by other fast-fashion groups. However, it lacks analysis of long-term trends or possibilities, accountability, scientific rigor, intellectual honesty, staying on topic, evidence, data, examples, and actionable insights.
Financial Relevance: Yes
Financial Markets Impacted: No
Financial Rating Justification: The article discusses Select Fashion’s potential collapse and its impact on creditors, including landlords and HMRC. It also mentions the company’s financial situation, such as owing £53.1m in debts and having only £1m in the bank at the time of administration.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text and it does not meet the criteria of an extreme event happening in the last 48 hours.
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