A.S. Adventure, which owns Cotswold in the UK and Bever in The Netherlands, is in negotiations about a debt rescheduling. The outdoor chain is dragging a heavy debt and has got into even bigger problems because of corona.
Substantial decrease in turnover
For the full year 2020, financial director Kris Horrevorst expects a decline in turnover of approximately a quarter. So far, the retail chain achieved a turnover of 360 million euros and a recurring gross operating profit of 11 million euros. In 2019, there was a turnover of 600 million euros and a rebitda of 41 million euros.
However, A.S. Adventure's biggest problem is the mountain of debt from the past, an important part of which arose when the chain was taken over by investment fund PAI. At the end of last year, the bank debts amounted to 258 million euros or almost 6.5 times the gross operating profit. The company always managed to pay the interest, but nevertheless violated its financial agreements several times, writes business newspaper De Tijd. Last year owner PAI again invested 15 million euros in the outdoor chain.
In order to get out of this negative spiral, A.S. Adventure is now negotiating with its creditors and PAI. Maybe it will come to a debt rescheduling, but the management does not want to give any details about possible measures. Another option is a new capital injection by PAI. "I am sure they will intervene if necessary. We are a profitable business," says CEO Frédéric Hufkens. The company wants to reduce its net debt to less than 4 times the ebitda over time.
In order to absorb the consequences of the first lockdown, A.S. Adventure took a whole series of measures. Among other things, the company reduced some investments and already renegotiated a series of rental prices. "Thanks to all these actions, we were able to get through the first lockdown in a liquid way," says Horrevorst. A.S. Adventure has 195 stores in the Benelux, France and the United Kingdom.