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Quiz putting loss-making stores division into administration

Quiz will look to buy back the stock and some of the assets from the store division so it can try and renegotiate better rents.

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Fashion chain Quiz has placed the division that runs its 82 standalone stores into administration as part of a restructure to offload loss-making outlets and slash its rent bill (Quiz/PA)

Fashion chain Quiz has placed the division that runs its 82 standalone stores into administration as part of a restructure to offload loss-making outlets and slash its rent bill (Quiz/PA)

Fashion chain Quiz has placed the division that runs its 82 standalone stores into administration as part of a restructure to offload loss-making outlets and slash its rent bill (Quiz/PA)

Fashion chain Quiz is placing the division that runs its 82 standalone stores into administration as part of a restructure to offload loss-making outlets and slash its rent bill.

The move will result in 11 permanent store closures 93 job losses.

However, the group said 822 of the 915 staff affected by the decision will remain with the group.

Quiz will look to buy back the stock and some of the assets from the Kast division placed in administration for £1.3 million so it can try to renegotiate better rents with landlords on some of the stores with a view to keeping them open.

It is with deep sadness and regret for some of our colleagues and partners that we had to take this decision to restructure the group's operations.Tarak Ramzan

It did not disclose how many stores it would be looking to retain as part of the deal.

A small number of job losses are expected across its head office in Glasgow and nearby distribution centre in Bellshill, with others at risk across stores, depending on negotiations with landlords.

Quiz said its concessions and international operations are unaffected by the move.

Tarak Ramzan, chief executive of Quiz, said: “It is with deep sadness and regret for some of our colleagues and partners that we had to take this decision to restructure the group’s operations.

“Whilst we have taken pro-active actions over the past 18 months to drive footfall to our stores and renegotiate leases to improve performance, the significant economic uncertainty we now face as consumers and businesses emerge from the Covid-19 pandemic has meant that, in order to ensure a sustainable future for the group, we have taken this decision to place the subsidiary which operates our stores into administration.

“We continue to believe that stores, with appropriate property costs and flexible lease terms, can continue to be a relevant pillar in our omni-channel model and we will be seeking to re-open Quiz stores where we believe it is prudent and economic to do so.”

Quiz, which will appoint administrators KPMG to the division on Wednesday, said while the shop chain had been loss-making, it continues to see a future for an “economically viable store portfolio” alongside its online business, concessions and international arm.

It said woes at the stores business have been compounded by the lockdown, which forced the closure of all non-essential shops in the UK since late March.

Blair Nimmo, joint administrator and head of restructuring for KPMG UK, said: “A combination of a highly challenging environment for bricks and mortar retailers during recent years and the Covid-19 lockdown have proven impossible for Kast to overcome.

“Despite their best efforts, the directors of Kast concluded that an Administration of Kast was unavoidable.”

The announcement comes after a tough period for Quiz, which has suffered sliding high street sales and losses due to tough retail conditions.

Retail experts have been questioning the future of Quiz in recent months as the chain battled sliding sales and dwindling numbers of shoppers on the high street.

But shares lifted 11%, having soared as much as 30% at one stage, as investors cheered hopes of a turnaround at the retailer.

Analysts at Panmure Gordon said: “The decision by Quiz to place its stores subsidiary into administration will allow it to try to achieve a renegotiation of its rental costs to reflect the realities of the current environment.”

PA