Laura Ashley Holdings plc (LON:ALY) have seen their shares bounce 45% on Wednesday afternoon.
Shares in Laura Ashley trade at 2p (+45.45%). 19/2/20 14:03BST.
The firm has seen a difficult period of trading over the last few months, and shares have been volatile. Questions were posed as to whether the firm could survive in an increasingly cutthroat British retail market.
The British High Street has notably seen the collapse of a few different firms over the last few months, and Laura Ashley have seen trading mixed over recent times.
The media put Laura Ashley under heavy pressure on Monday, when issues over company financing raised.
Today, Laura Ashley have given shareholders a confident update and seem to have answered critics in the media.
The homeware retailer said that it had secured approval to utilize funds from its working capital facility with Wells Fago. The funds that had been approved met its immediate funding requirements, following the statement issued on Monday.
Laura Ashley further reenforced their position that this did not constitute a cash injection by MUI Asia into the company.
The firm commented this afternoon “Laura Ashley Holdings PLC is pleased to announce that discussions between Wells Fargo and MUI Asia Limited relating to the Group’s immediate funding requirements have concluded and the Group should be able to utilise requisite funds from its working capital facility with Wells Fargo to meet its immediate funding requirements. As previously announced, this is not a cash injection by MUI Asia Limited into the Group.”
Laura Ashley face tough media critics
On Monday, the firm saw its shares crash 43% after they announced that trading had slipped over the festive period.
The announcement was in response to “speculation regarding its financial position.”
Laura Ashley said that in the 26 weeks up to 31st December 2018, total group sales were £109.6 million, which saw a 10.8% drop from £122.9 million in 2018.
Notably, the firm said that the decline in total revenue was due to market headwinds and decreased consumer spending.
The update today will alleviate some of the pressure that Laura Ashley have faced, and certainly will allow the firm some breathing space from the intense scrutiny which was raised on Monday.
