Blue Inc losses ballooned prior to CVA deal

The embattled menswear chain’s pre-tax losses hit £16m in the 18 months to July 2, 2016, in contrast to a £2.6m loss during the comparable period ended December 30, 2014.

Blue Inc registered £23.4m in sales during the 18-month timeframe and recorded a gross profit of £11.98m, according to documents filed at Companies House.

But the retailer forked out £18.78m in administrative expenses and a further £8.78m for what it called “exceptional” administrative expenses, driving an operating loss of £15.58m.

Blue Inc said in the filing that “directors have a reasonable expectation that the company has adequate resources to continue in existence for the foreseeable future”.

The far from positive forward-looking statement comes as the business faces into sluggish trading and a fiercely competitive landscape.

Blue Inc launched a CVA in March this year, outlining plans to slash rents and shutter 33 of its 127 stores after failing to find the £3m of additional capital it needed to pay for stock and service its debts.

The CVA was unanimously approved by creditors after more than 80% of them voted the radical plans through.

The vote came just over a year after Blue Inc put its subsidiary company A Levy into administration to close 76 stores and shed 500 jobs.

It then bought back part of the business in January 2016, enabling it to continue trading.