REPORT_ UK operation of Forever 21 has reported a loss of more than 66.5 million pounds (110.4 million dollars) for the year to February 28, 2013, on the back of impairment charges of more than 44 million pounds (73.1 million dollars). As per the company statement, “Whilst the company is loss making,
the directors have obtained confirmation from the directors of the ultimate parent company Forever 21 Inc that they will continue to support the company for a period of not less than 12 months from the date of approval of the financial statements to enable the company to meet its liabilities as they fall due.”
The American
retailer debuted in the UK market in 2010 and has eight stores there. Its UK revenues grew by 59 percent to 37 million pounds (61.4 million dollars) from 23.2 million pounds (38.5 million dollars) in 2012.
During the reported period, the company opened stores in Bluewater, The Trafford Centre and Lakeside, and the extension of its Oxford Street store. According to accounts filed at Companies House, Forever 21 had impairment losses worth 19.44 million pounds (32.2 million dollars) for leasehold acquisitions in the year, and a further 23.2 million pounds (38.5 million dollars) for leasehold improvement.
Forever 21 UK also reported a rise in cost of sales, to 21.9 million pounds (36.3 million dollars) from 12.3 million pounds (20.4 million dollars) the year before. Gross profit rose 40 percent, slower than the retailer’s turnover.
