House of Fraser is seeking to slash rents of some of its UK outlets, it has been confirmed.
The department store chain has contacted an undisclosed number of the owners of its 59 stores to ask for a substantial reduction in rent bills, reports Sky News.
The news comes just weeks after House of Fraser had its credit rating downgraded by investor agency Moody’s following three consecutive quarters of poor financial results due to both challenging market conditions and company specific factors, notably disruption caused by the launch of a new web platform and underperformance in own brands.
House of Fraser is expected to publish details of its Christmas trading performance next week, when rival chains including Marks & Spencer and the John Lewis Partnership are also due to update investors and analysts.
Next raised hopes of post-Christmas cheer on the high street when it reported a better than expected sales performance last week, with figures increasing 1.5% in the 54 days to December 24.
But this was quickly overshadowed by a profit warning from HoF rival Debenhams.
The retailer has said that its underlying pre-tax profits are likely to be between £55m and £65m for the year, should the current “competitive and volatile environment” continue.
Debenhams’ like-for-like sales in the UK for the 17 weeks to 30 December fell by 2.6%, while international sales were up 2.1% and digital sales saw a 9.9% growth.