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TJ Hughes collapses into administration

TJ Hughes, the discount department store retailer, is the latest high street name to collapse into administration following a prolonged period of depressed consumer spending.

More than 4,000 jobs at the 99-year-old chain are now at risk as administrators to the chain seek a buyer for the 57-shop retail group.

Ernst & Young was appointed as administrator on Thursday. Tom Jack, joint administrator said: "The retail environment has been particularly tough during the first six months of this year and TJ Hughes has struggled against a backdrop of reduced consumer spending and increased competition.

"Whilst management have tried to reinvigorate sales performance and control costs, it has unfortunately not been possible for the business to continue to trade outside of insolvency." Ernst & Young is seeking offers for the sale of the business as a going concern.

Mr Jack added: "TJ Hughes will continue to trade as we look for a buyer of the chain. It is very much business as usual and we are grateful to the chain's loyal customers, employees and suppliers for their continued support."

TJ Hughes was founded in 1912 and its head office is based in Liverpool. A message on the retailer's website yesterday said that the site was "undergoing essential maintenance" and urged shoppers to "call back in a short while".

The retail company is the latest in a long line of established high street names to fall on hard times. Jane Norman, the fashion retailer, went into administration in recent weeks after a period of poor sales. Just over 30 of its 94 stores were bought out of administration by Edinburgh Woollen Mill.

Focus DIY has also recently collapsed, and a raft of other chains have been forced to issue profit warnings.

Lord Harris of Peckham, the chairman and chief executive of Carpetright, the floor-coverings retailer, said this week that he sees "no respite" in the challenging retail environment over the next year.

UK households have been hit by high inflation, increased tax and fuel bills, and concerns over job security as a result of government cutbacks.

Source : James Hall - The Telegraph
www.telegraph.co.uk/finance/newsbysector/retailandconsumer/8609478/TJ-Hughes-collapses-into-administration.html

30 June 2011
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