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Flying Brands close to agreeing sale of Gardening Direct

Flying Brands is disposing of all but one of its brands and closing its head office after making large losses in 2011.

Online & mail order retail group Flying Brands is close to agreeing the sale of its Gardening Direct business, it was revealed today.

Full-year results published by the company show that it lost 2.8 million in total in the 12 months ending December 30th 2011, and it has been trying to slim down its operations in order to return the business to profitability.

Earlier this month shareholder approval was obtained for the sale of its gifts division to flowers specialist Interflora for £2.4 million, which followed on from the disposals of its entertainment retail brand Listen 2, three of its gardening products brands, and other concerns such as Dealtastic and Benham.

Once Gardening Direc t is sold, Growing & Live Dispatch will be the group’s last remaining business and as such further reductions in staff numbers will be undertaken, with the closure of its call centre & head office based in Chelmsford.

Flying Brands Chairman Tim Trotter explained that a significant reduction in trading across its operations meant the group could no longer service its level of borrowings, “we therefore embarked on a strategy to cut our bank borrowing, reduce our level of trade creditors and exit those businesses that we felt we could no longer adequately support.”

Trotter continued: “We have also embarked on a restructuring programme to reduce central overheads to a level more appropriate to our slimmed down business and we expect to have reduced overheads very significantly by the end of the first half of 2012.”

A new overdraft has been by the firm with Barclays with a facility of £250,000 in order for it to carry on operating the Gardening Direct business until it is sold.

Flying Brands hopes to have completed the sale of Gardening Direct by June and at this time it is likely to make a strategy announcement to shareholders about the likely future of the company.

Source : Jon Whiteaker – Retail Gazette
www.retailgazette.co.uk/articles/02034-flying-brands-makes-further-cuts-as-losses-mount

30 April 2012
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