Comet is to close 17 under-performing retail outlets after being hit with an £8.9 million loss in the last financial year.
According to the Dow Jones Newswire, like for like sales for the year dropped by 7.7 per cent and total revenue declined by 6.8 per cent, despite the company having reduced its operating costs by seven per cent.
Although a turnaround programme – which included cost reductions schemes as well as a rebrand and new marketing campaign – had been initiated, and despite strong performance over Christmas and New Year, the retailer was hit by “weakness in the market and tougher trading conditions in the final quarter” following the VAT rise.
As well as closing the stores, the retailer will consolidate its 14 regional service centres in to two sites, reduce its warehouse network from three to two and will reduce staff numbers at its head office.
In addition, the Financial Times alleges that activist investor Knight Vinke, who holds 18 per cent of Kesa’s shares, is putting pressure on the French firm to sell Comet and move its stock listing to France.