Furniture retailer Land of Leather has been placed in administration this afternoon (January 12). The move follows its stock market trading suspension earlier today after months of speculation over its future.
The retailer announced last October its profits had crashed by £16.2m, from £18.5 million to £2.3 million in the year to August 3rd 2008.
Administrators Deloitte hopes to sell the 109 UK and Ireland stores, which will remain open, as a complete on-going concern.
In a statement to the stock exchange the retailer blamed the move on “challenging market conditions as a result of the credit crunch and lack of consumer spending on bigger ticket retail purchases”.
The statement says that the January sale has failed to boost the chain’s fortunes, and that a “lack of liquidity in the banking system” prevented it from finding a way to avoid calling in the administrators.
Land of Leather’s marketing director Peter Ling resigned last month following a decision to slash the advertising budget in 2009. The retailer spent £21.4m on advertising in the last financial year.
Meanwhile, high street book retailer Waterstone’s has this afternoon (January 12) confirmed it is consulting with store staff over a number of redundancies prompted by changes to its supply chain management.
The announcement comes ahead of a trading statement by its parent company HMV, which is expected on Thursday.