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Carpetright faces £9m loss ahead of closures

Carpetright, which has eight stores in Northern Ireland, has said it will book annual losses of up to £9m after the struggling retailer's shareholders rubber-stamped a mass store closure programme.

The group said yesterday that it expects a full-year underlying pre-tax loss of between £7m and £9m, which compares with a £14.4m profit last year.

It comes as investors approved its Company Voluntary Arrangement (CVA), a process that will allow it to shut loss-making outlets and secure rent reductions.

But the location of the stores to be shut has not been made public.

Carpetright has earmarked 81 stores for closure, with the rent on another 113 set to be slashed. A total of 300 jobs are at risk as a result of the CVA. Last week it secured the backing of creditors and landlords for the CVA and attention will now turn to efforts for an equity fundraising.

Carpetright is attempting to raise around £60m through a rights issue to put the company on a firmer financial footing.

Chief executive Wilf Walsh said: "The CVA proposal will enable us to take the tough but necessary actions needed to restore our profitability.

"Having now received approval from both shareholders and creditors, we will press ahead with our plans for the proposed equity financing to recapitalise the business and enable Carpetright to address the competitive threat from a position of strength."

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