House of Fraser department store group lost almost £44 million in 2017 due to falling sales.

The store’s potential new Chinese owner, C.Banner (HKG: 1028), revealed at the Stock Exchange on Thursday that the £43.9 million reversed the pre-tax profit of £1.5 million for the previous year.

Sales fell 6.3 percent to £787.8 million in the tough UK market.

The figures released included the start-up and operating costs of House of Fraser China. Separate UK figures have not been reported.

C.Banner has said that House of Fraser will become “more stable” following the restructuring plan and will “take advantage of its well-known brand to capture growth potential”.

The group also blamed Brexit and London terror attacks for the volatility in the UK retail market.

“The Brexit referendum and the UK’s resultant decision to leave the European Union and the terrorist attack in London, combined with a rapidly evolving retail market, produced a period of uncertainty and volatility that resulted in a difficult trading environment for the whole retail industry in the UK,” said the document released by C.Banner.

C.Banner has said it plans to buy 51 percent stake in House of Fraser in order to “enhance the company’s presence in the retail market in [China] as well as to facilitate the company to lay a good foundation for a new brand and retail roadmap overseas”.

The deal depends on the agreement by bondholder and shareholders, as well as the restructuring plan where about 20 stores are expected to close.