Wed, 21 Jul 2021 | ADMINISTRATION
JTF Mega Discount Warehouse has fallen into administration after a potential buyer pulled out of a deal to acquire the business at the last minute. The discount chain, which requires customers to join as members and has 12 outlets in retail parks across the Midlands and north of England, says it will continue to seek a buyer.
The company was acquired by current chairman Arthur Harris in January 2020, saving it from entering administration at the time. In the first four months of ownership, the new leadership cut the firm’s annual overheads by around £2.5 million and successfully tackled its £7 million debt burden, returning it to profitability.
However, plans to take the business forward were disrupted by the Covid-19 pandemic. Despite remaining open during lockdowns due to its classification as an essential retailer, the pandemic dramatically impacted two of JTF’s biggest seasonal periods: fireworks sales around Bonfire Night and the Christmas sales.
JTF sold a wide array of discount items, including home and garden furniture, toys and health and beauty products. Over recent weeks, its stores had been undertaking clearance sales, in which stock was reduced by 50 per cent, before closing.
The closures were said to be temporary measures ahead of a relaunch; however, these plans appear to have fallen through with the withdrawal of the unnamed buyer. JTF’s 500 staff, who were initially placed on furlough when stores closed, have now been made redundant.
According to the chain’s most recently available accounts at Companies House, to the year ending March 24 2019, its fixed assets were valued at £1.5 million, while current assets stood at £10.8 million.
In the same period, the company registered a post-tax loss of around £2.8 million on turnover of £64.3 million. However, the business’ fortunes revived during the first four months of Harris’ ownership, during which time it reported operating profits of around £1 million.
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