Examiner appointed to retailer A-Wear

An interim examiner has been appointed to fashion retailer A-Wear which has 30 outlets. The chain, which employs more than 350 people, is blaming its difficulties on high rents and increased competition.

The company hopes that the vast majority of those jobs can be saved.

At the High Court, Mr Justice Peter Charleton appointed Ken Fennell, insolvency practitioner, as interim examiner to Latzur Ltd, trading as A-Wear, after an independent accountant’s report said it had a reasonable prospect of survival if certain steps were taken.

These steps include the examiner putting together a scheme of arrangement with the firm’s creditors, which if approved by the High Court, would allow the company to trade as a going concern.

Obtaining a reduction in the rents will form an important part of the firm’s future.

Bernard Dunleavy for the company, said A-wear was purchased by it current owners from receivers in 2012. While they had reduced the firm’s annual loses from €5m to €2.5m per year, they had taken things in certain regards “as far as they can”.

Rent at its Grafton St Store in Dublin counted for 28% of its revenues.

In addition, the retailer had faced increased competition, from low- cost competitors, in the 18-35 age group ladies fashion market. Steps have been taken by A-Wear to reposition itself in that key area, counsel said, adding that some progress has already been made.

Mr Dunleavy said the firm’s wholesale business and internet sales were profitable. It intends to expand this part of its business in conjunction with European partners if the examinership proves successful, counsel added.

Mr Dunleavy said the appointment would allow negotiations on rent agreements and ensure vouchers would be honoured.

Mr Justice Charleton said there were “strong reasons” why an examiner should be appointed. The matter was adjourned to a date later this month.