Mon, 03 Jun 2024 | ADMINISTRATION
Smiffys, a fancy dress manufacturer and distributor dating back to the 19th century, has filed a notice of intention to appoint administrators (NOI) after reportedly failing to find a buyer. The company, which was founded in 1894 and is part of R.H. Smith & Sons (Wigmakers) Limited, is said to have suffered as a result of overstocking and inflationary challenges.
According to its website, the family-owned company ships in excess of 26 million fancy dress items annually, distributing approximately 7,500 products to thousands of stockists worldwide.
However, it has suffered in recent years as a result of COVID-19, supply chain disruption and rising inflation. Over the past few weeks, the company has reportedly sought to secure a solvent sale, but has now lined up PwC to act as administrators having failed to find a buyer.
In a statement, the company said: "Following four extremely challenging years as a result of the pandemic, the subsequent supply chain crisis, and the ongoing inflationary burden on both businesses and consumers, Smiffys was required to take the difficult decision yesterday to file a notice of intention to appoint administrators.”
The company emphasised that the NOI “does not mean” that it is in administration, but enables it “to explore a number of potential options, with the ultimate aim of securing a sustainable business for the future.” The statement added that the company "will continue to trade and fulfil orders as normal during this time".
In R.H. Smith & Sons (Wigmakers) Limited’s most recent accounts at Companies House, for the year to March 31 2023, it reported turnover of £54.7 million, up from £39.6 million a year earlier, but fell from an operating profit of £274,285 to a loss of just over £3 million.
In the report, the company’s directors stated that trading during the period had “improved significantly over the prior year” as a result of concerns and restrictions relating to the COVID-19 pandemic easing.
However, they added that “the aftereffects of COVID still had a strong adverse influence”, saying “major disruption to freight routes” had affected its ability to capitalise on growing demand and that it was also hit by container rates multiplying “up to tenfold during the year.”
At the time, the firm’s fixed assets were valued at £1.48 million and current assets at £30.2 million, but net assets amounted to just £5.49 million, down from £9.2 million a year earlier.
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