Kitchenwear specialist Lakeland has sealed a £16m funding deal from the Royal Bank of Scotland (RBS) which it plans to use to boost expansion.
The retailer, which is headquartered in Cumbria, said the investment would be used to support its international expansion and boost its store and online presence.
The funding replaces its existing lending arrangements and comes after Lakeland reported a “disappointing” set of results in September.
Its operating profits for the year to December 31, 2013 dropped from £6.18m to £3.01m. Sales increased 5.7% to £166m.
The retailer reported it was a “disappointing result but with the actions taken during the latter part of the year and the improvement in our systems and infrastructure we expect profitability to return to more normal levels in 2014”.
Lakeland ploughed £10m into a 60,000 sq ft distribution centre in Kendal which opened in early 2014.
The retailer also attributed its fall in profits to “increased competitive margin pressure” and gross margins fell from 52.1% to 50.6% after being affected by a competitive trading environment, particularly in the branded electricals product sector.
Of the funding, RBS relationship director Bob Granger said: “The revolving credit facility has been committed for five years and we are confident it will help them shape the future growth of the business.”