Findel profits up as it seeks to raise £80m through rights issue

Sales from continuing businesses slipped to £152.3m from £152.5m in its home-shopping division, which incorporates the Express Gifts and Kleeneze catalogues as well as Kitbag, the online football kit retailer.

The retailer narrowed its group losses from £22.7m to £15.5m. Group sales from continuing operations declined from £260m to £255.8m, which the retailer described as “stable”.

Findel has undertaken a business review which identified “underinvestment in key areas”. The Board now seeks to raise £80m of equity through a right issue, and plans to plough £35m back into the business. £40m will be used to pay its lenders to reduce its debt.

Findel chairman David Sugden said: “Our existing businesses are capable of significant improvement in profit performance. We are at an advanced stage in our negotiations with our major shareholders and lenders to agree a comprehensive refinancing of the balance sheet.”

Investments will be made across Findel, which also includes education supplies and healthcare divisions.

In the home shopping division £7m will be invested in improving systems in its Express Gifts business and further funds will be used to improve its credit management and buying processes. Investment will also fund extra distributors for its Kleeneze business.