Quiz, a fashion retailer, plans to exit the stock market as financial challenges deepen.
- The company proposes to delist from the Alternative Investment Market (AIM) and register as a private limited entity.
- Quiz founder Tarak Ramzan and major investors support this decision, viewing it as beneficial.
- Financial distress has intensified due to poor trading performance and declining sales figures.
- The company warns of potentially exhausting bank facilities by early 2025.
Quiz, a well-known fashion retailer, has proposed leaving the stock market by canceling its listing on the Alternative Investment Market (AIM). This strategic move is seen as a response to the ongoing financial turbulence the company is facing. The decision requires a 75% majority vote from shareholders, which will be determined in a meeting scheduled for January 8, 2025. If approved, the delisting process would be completed by January 23, 2025. Founder Tarak Ramzan, along with key investors Tajveer and Amraj Gill, are expected to vote in favor, indicating strong internal support for this course of action.
The company’s management believes that delisting will serve the best interests of both the company and its shareholders, particularly in light of the financial difficulties it is experiencing. Earlier this month, Quiz initiated a strategic review following warnings of potential cash shortages entering the new year, exacerbated by tough trading conditions. The retailer’s struggles began to sharpen in June, heavily impacted by a cost-of-living crisis that affected its consumer base.
Recent sales figures reflect a challenging landscape, with a notable 5.7% decline in sales for the four months leading up to November 30, leading to revenues of £24.9 million. A significant drop in both online and in-store traffic has contributed to these results. Additionally, the company’s available cash headroom has dwindled to a concerning £1.2 million, a development that Quiz has acknowledged does not align with previous expectations.
As a result, the company has cautioned that, depending on trading performance during the critical pre-and-post-Christmas period, existing bank facilities might be fully tapped by the first quarter of 2025. In response, Quiz is actively reviewing its financial strategies and seeking options to bolster liquidity. Advisors have been engaged to explore viable financial strategies, and further information will be shared with shareholders when appropriate.
Amidst this financial restructuring, the role of chief financial officer has also come under scrutiny. Gerry Sweeney, who has served in this capacity for over eight years, will depart from the company next year, staying on until March 31 to ensure a smooth transition to his successor. His exit coincides with a period of declining sales and profits, highlighted by a swing from a £2.3 million profit in 2023 to a near £7 million pre-tax loss in the financial year ending March 31, 2024.
Quiz’s departure from AIM signifies a pivotal strategy to navigate financial challenges and stabilize operations.
