Lingerie and sex toys specialist Ann Summers is poised to launch a CVA after suffering increased losses in its latest reported year.

Ann Summers chief executive Jacqueline Gold, writing exclusively for Retail Week, set out in stark terms the options facing the retailer as some landlords refused to work in partnership despite the owning family pumping in more cash.

Ann Summers’ losses spiralled to £16m from £3m in its most recently reported year, according to figures soon to be filed at Companies House for 2018/19.

Although performance subsequently improved on the back of changes including personnel, IT investment and product improvement, Ann Summers is also now navigating changing market conditions precipitated by the Covid pandemic and property costs are biting.

While some of the retailer’s landlords have taken a “pragmatic” approach, others have not and the 90-store business is understood to be preparing to unveil CVA proposals in the next week or so.

Exact details have yet to be revealed, but Gold wrote: “Ultimately no retailer can afford to run stores unprofitably, and with business rates set to return next spring, the challenge of property costs is going to become even more pressing than ever.

“We want to work in partnership with our landlords and our interests should be aligned. That’s why we, like many retailers, think turnover-based rents are the way forward. 

“We recognise that our landlords are businesses too and we understand they will need a return. I’m pleased to say the majority of ours are sensible and have been open to negotiations. 

“However, there are some who haven’t and who continue to bury their heads in the sand when it comes to these discussions. And the way the system is set up, if they won’t come to the table, the only way a retailer is able to resolve the situation is to undertake a CVA.”

“My family has ploughed large sums of money into the business to help us address the issues which held us back last year and get Ann Summers back on an even footing, with plans to invest further. But there is no point doing that just to subsidise those landlords who continue to cling on to outdated terms.”

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