Headlam Appoints Administrators; Updates on Trading

• Continued trading while the restructuring is carried out
• Administration process provides the statutory protection and time needed to pursue the restructuring plan
• Subject to successful completion of the restructuring, the Company intends to seek the restoration of its suspended listing

Appointment of Administrators

Further to the announcement on 1 September 2026, the Board of Headlam Group plc confirms that Will Wright, Chris Pole and Ryan Grant of Interpath Advisory will be appointed as joint administrators to Headlam Group plc and HFD Limited later today, once confirmed in court.

The objective is to stabilise operations and maintain service for customers whilst engaging directly with suppliers and other stakeholders to attempt to implement a comprehensive restructuring of the Group.

Trading Update

Following the appointment of the administrators, the joint administrators intend to keep the business trading while a restructuring of the Group's operations is implemented.

As previously announced, the Board had been undertaking a strategic review which pursued a range of options to address the Group's liquidity position, resulting in the development of a comprehensive transformation plan.

However, given the scale of losses incurred over recent years and the exhaustion of liquidity under the existing Group's existing facilities, the Company was unable to implement the transformation plan within the constraints of its funding position. The administration provides the statutory protection and time required to pursue the restructuring.

The proposed restructuring is expected to include a Company Voluntary Arrangement (CVA) and a refinancing of the Group's existing debt facilities, alongside significant cost reduction measures. These steps are intended to give the business the best opportunity to trade through its current challenges and establish a more sustainable platform for the future but are subject to how discussions with key stakeholders progress in the coming days.

The Group's existing lenders have indicated their support for the proposed administration.

The current management team will remain in place during the administration, operating under the direction and supervision of the joint administrators. The Company will keep employees, customers and suppliers informed as the process progresses.

The Group's other trading subsidiaries currently remain unaffected by the proposed appointment of administrators to Headlam Group plc and HFD Limited.

Directorate Changes

Upon the appointment of administrators, Stephen Bird, Non‑Executive Chairman, and Nick Kelsall, independent Non-Executive Director and Audit Committee Chair, will both step down from the Board.

Conditional on the successful implementation of the restructuring, Wilf Walsh, current Non‑Executive Director, will assume the role of Non‑Executive Chairman. Wilf served as Chief Executive Officer of Carpetright from 2014 to 2021 and then as Chair of parent company Nestware Holdings until his retirement in 2022.

Subject to the successful completion of the administration and restructuring, the intention would be to seek the restoration of the listing and transition to a reconstituted Board.

Further announcements will be made as appropriate.

Sale and leaseback of Bristol distribution centre

Headlam (LSE: HEAD), the UK's leading floor coverings distributor, is pleased to confirm that as part of its strategic review, it has completed the sale and leaseback of its Bristol distribution centre property (the "Disposal").

The sale proceeds of £3.15 million (excluding VAT¹) represent a premium of 50% to the book value of £2.1 million and 13.7% to the last market valuation² of £2.775 million.

The Bristol distribution centre remains a core part of Headlam's distribution network and therefore trading continues as usual following the sale. The Bristol Trade Counter will also remain operational. The Group has entered into a leaseback until 31 December 2026.

£3.15 million of the sales proceeds (excluding VAT) have been received in cash following simultaneous exchange and completion. The net sale proceeds will be used to repay existing debt after deducting part of the proceeds to fund the upfront leaseback costs for one month during the restructuring period as Headlam seeks to establish a more sustainable platform for the future.

This sale constitutes a significant transaction under the Listing Rules; accordingly, further details are contained in the appendix to this announcement.

^1.   VAT of £630,000 has been collected on this sale and will be paid over to HM Revenue & Customs at the next VAT quarter end payment date.

^2.   As at the market valuation undertaken in December 2025.

Source : Headlam plc

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