The poor financial state of Sir Philip Green’s Arcadia Group has been laid bare in documents sent to landlords ahead of an imminent company voluntary arrangement.
The documents show that Green is planning on selling or closing all of Arcadia’s international businesses, which are mostly loss-making, and that both the group’s total and like-for-like sales tumbled last year, according to The Sunday Times.
Total sales were down 10.5% to £1.7bn in the year to August, while like-for-like sales fell by 7.5%.
The documents, sent to landlords last week ahead of an imminent CVA, state that Green would seek to shut 57 stores across the group if the proposal were accepted.
Most worryingly for Green, the CVA documents show that the financial failings of the group are being driven by Topshop, once the jewel in its crown. In the run-up to Christmas the fashion brand’s like-for-like sales tumbled by 20%.
Arcadia has also been hit by the removal of credit insurance to its suppliers, which prompted many to demand payment for goods upfront.
The proposed Arcadia CVA is seeking to slash rents across the rest of the group’s store estate by an average of 30%.
Green, who was recently stripped of his billionaire status in The Sunday Times Rich List, is also locked in an ongoing battle with the Pensions Regulator over a deficit thought to be as much as £750m.
The group has 1,170 outlets in 36 countries outside of the UK, although many are department store concessions or franchises.