Shares in Quiz Clothing, the Glasgow-based retail chain, plunged by 43% after it said it will need to find additional funding early next year if there is no “material improvement” in trading and a loan deal does not come through.

The company said it expects to provide a further update alongside its results for the six months ended 30 September 2024 in mid-January.

Revenues in the period from 1 August to 30 November 2024 amounted to £24.9 million, a £1.5m reduction on the previous year. 

As at 5 December the group had net borrowings of £2.8 million and total liquidity headroom of £1.2 million.

In a trading update it said that “given the disappointing level of revenues in November the cash headroom available to the business is less than previously anticipated. 

“As a result, and subject to the trading performance during the important pre-and-post-Christmas period, the group’s existing bank facilities could be fully utilised in the first quarter of 2025.” 

It announced, on 29 August, that Tarak Ramzan, the company’s founder and largest shareholder, has offered to provide a £1 million loan facility to provide additional liquidity headroom for working capital purposes.

The board is reviewing the group’s financing and strategic options and has engaged advisors to consider appropriate options. A further update to shareholders will be provided as and when appropriate.

“In the absence of either a material improvement to trading during the important pre-and-post-Christmas period, the majority shareholder loan being agreed and made available to the group or a combination of these eventualities, the board anticipates that additional funding will be required by the group in the first quarter of 2025”.

Shares in Quiz, traded on AIM, closed 43.18% lower at 3.04p.

Black Friday uplift for retailers

Scottish retail sales rose over Black Friday weekend against last year, as they benefited from shoppers delaying purchases. Non-food sales increased by 7.5% YoY.

UK footfall was up 4.8% on Black Friday and 10.6% on Cyber Monday, year on year, and up 4.1% for the 4-day period.

Ewan MacDonald-Russell, deputy head of the Scottish Retail Consortium, said: “Scotland’s shoppers took advantage of promotions and offers both in person and online as the Black Friday weekend finally kicked off Christmas trading.”

Retail parks and shopping centres saw the biggest surge of customers over the Black Friday weekend, with overall footfall rising 4.8% on Black Friday week as compared to the previous year. The increased traffic helped retailers to a much-needed Black Friday boost, with sales up 10.7% for non-food for the week, helped by its closer proximity to Christmas this year.

Black Friday remains an omnichannel event, but online growth still showed the biggest gains in the final week, with computing, fashion, and beauty among the most popular categories.

“After this strong start retailers will be hoping customers continue to come out to the shops over the coming weeks to make this a Christmas to remember after a disappointing year for retail trading,” said Mr MacDonald-Russell.

Linda Ellett, UK head of consumer, retail & leisure at KPMG, said: “Retailers will be relieved that consumers were holding back their November buying for Black Friday week promotions, rectifying the disappointing retail sales levels seen during the rest of the month.  Black Friday week saw growth of over 6% on last year.

“With Christmas in sight, retailers are hoping that the gift buying isn’t done yet and will be keeping a close eye on their data as they target their festive promotions and Boxing Day sales to capture consumer attention once again.”