Office earmarks 15 loss-making stores for closure over next two years

Truworths chief executive Michael Mark told analysts last week the group expects to run down leases on between 10 and 15 of its 139-strong UK store estate over the next two years, as part of a turnaround plan to boost sales and profits at the struggling footwear retailer.

In the presentation, Mark also earmarked three “problematic” Office concessions for closure over a two-year timeframe.

He said: “Closure of poor-performing stores remains a priority while enhancing the e-commerce offering to grow sales in a consumer environment trending towards online shopping – footwear is highly conducive to online retailing.”

South African-based Truworths cited Brexit as an issue as well as the “intense pressure” being put on consumer confidence.

Despite these challenges, Mark said “given current levels of profitability, cash generation, solvency and liquidity, no major business restricting is appropriate”.

The news comes after it emerged in June that Office had appointed advisers Alvarez & Marsal and Deloitte to examine restructuring options, including a possible CVA.

In the year to June 30, Office had an operating loss of £94.7m, despite sales jumping 1% to £279m driven predominantly by a 10% uptick in digital sales.

Office also suffered from department store chain House of Fraser entering administration, as it was owed £700,000 from its concessions across the department stores.