A GIANT fishing tackle chain has been seeking emergency funding in order to stay afloat and save stores and jobs.
Fishing Republic, one of only two tackle retail PLCs, has warned that if it fails to raise additional funding, it could affect the group’s ability to trade, putting over 100 jobs in jeopardy.
The company shares were suspended from trading on the London Stock Exchange AIM market in October after certain major shareholders announced that they were no longer prepared to provide financial assistance to the group.
Since then it has been working with its advisors to assess a number of options for the future.
In an update released to the Stock Exchange, Fishing Republic said: “The company is currently seeking to raise equity finance to fund its immediate and future working capital requirements.
“If this fails to raise sufficient equity finance and no other funding becomes available, there will be a significant doubt as to the group’s ability to continue to trade as a going concern.”
It added that the group continues to trade only with the short-term support of key creditors. A further announcement is expected.
Its incoming new chief executive Daniel Quinn, who was due to start on October 17, said he would postpone joining the company after the news, while its current boss and former executive chairman James Newman holds the fort.
Quinn previously worked at JD Sports and Tesco and was drafted in by former Tesco Boss Sir Terry Leahy, who owns a 9.3 per cent stake in Fishing Republic, in an attempt to turn their fortunes around.
The retailer posted a pre-tax loss of £2.5 million in September, up from a £117,544 loss a year earlier.
The company floated on the AIM stock exchange in 2015, and raised millions to help carry out its expansion plans. However, turnaround plans were required during 2017 to tackle “a significant deterioration in trading.”
Reporting its interim results for the six months ended June 30 2018, the company said that it is in a year of transition and that financial results “reflect the challenging period, including the very difficult trading backdrop.”
Revenues of £3.4m for the period, were down from £4.1m in the same period of 2017.
The company has 14 large super-stores across the country as well an online business.
Angler’s Mail columnist, tackle supplier and England lure fishing team manager Steve Collett commented: “I’m not surprised that the company is struggling and I’m not sure there is room for two big retail giants in what is a difficult market.
“I did buy shares myself initially but soon got out as I didn’t think their business model was very good.
“The CEO described ordinary tackle shops as being run by ‘ma’s and pa’s’ but some of us have million-pound turnovers, and had strange ideas about the age and gender of those who fish.
“But trade is generally down with angling in decline and even though my turnover has gone up, my profit margin has declined and if I was on the stock exchange I would have to give a profit warning.
“There are only so many big articles, like rods and reels, that people can buy and so many anglers can get tackle from sponsors these days or through eBay or Amazon.
“I feel sorry for the big tackle shop owners that the company bought out as I believe they were largely paid in company shares which will be worthless if the company do go bust.
“I had heard that some of their stores lacked stock and there is no doubt that many anglers enjoy a smaller space that stinks of fishing and where there are a couple of codgers who reckon they’ve caught 4 lb roach and 40 lb pike!” Steve concluded.
In stark contrast, Angling Direct, the UK’s other big tackle retail giant PLC, is thriving. It recently obtained a further £20 million in investment by a successful release of shares, with plans to open 20 new stores in the next two years to add to the 24 they already own.
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