(Reuters) - Carpetright's <CPRC.L> losses ballooned in the first half of the year, the British floor coverings chain said on Tuesday, hit by weak demand from customers and the fallout of a survival plan which has closed dozens of underperforming stores.
A series of British retailers have either gone out of business or announced plans to close shops this year, as they struggle against subdued consumer spending, rising labour costs, higher taxes and growing online competition.
Carpetright raised 65 million pounds through an equity issue in June after creditors and shareholders backed a Company Voluntary Arrangement (CVA) restructuring to close stores and cut jobs. Its shares have slumped almost 50 percent this year.
The company said the restructuring programme was going as planned and would result in 19 million pounds of annualised cash savings.
"This is a transitional year for Carpetright as we work through our restructuring plan," Chief Executive Wilf Walsh said in a statement. "We remain on schedule and are confident that this activity is already starting to yield benefits."
Carpetright, which sells mattresses, headboards, engineered wood flooring and luxury vinyl tiles, has also been looking to refurbish stores and invest in digital technology to improve both its online and in-store experience for customers.
It said store refurbishments had been temporarily paused, as the company looks to get more clarity on its UK store portfolio. It intends to resume refurbishment activity in the second half of the year.
The company reported a pretax loss of 11.7 million pounds in the 26 weeks ended Oct. 27, compared with a loss of 600,000 pounds, a year earlier.
Revenue fell 15.7 percent to 191.1 million pounds.
(Reporting by James Davey in London and Arathy S Nair in Bengaluru; Editing by Sai Sachin Ravikumar)