Matchesfashion, the London-based fashion retailer, has said that it may run into the risk of breaching bank covenants as it witnesses fall in revenue and rise in losses.
The British retailer has seen its adjusted EBITDA go into a loss of £23.5 million from a profit of £4.5 million a year earlier. The revenue too has slumped by 9 per cent to £392.1 million year-on-year.
The retailer has attributed the losses to lower demand for apparels associated with social events and functions – owing to frequent pandemic-induced disruptions and restrictions.
PWC, the auditor, has said that “Based on their base case and downside case financial projections, management do not currently expect the business to achieve compliance with their financial covenants at 31 January 2022.
Matchesfashion is now at the risk of breaching its banking covenants in January next year under its ‘base case’ and ‘downside case’ assumptions.
Founded in 1987, Matchesfashion is known for menswear, womenswear and fashion accessories.