The future of upmarket jeweller Theo Fennell has been plunged into uncertainty after it was forced to call in administrators yesterday.
The company was in the middle of a restructuring programme but said the “burden” of certain fixed costs had hit the business hard and threatened its ability to trade.
A number of staff have lost their jobs as administrators work to find a solution that will keep the business afloat.
Accountancy firm BDO confirmed to Professional Jeweller this morning that business restructuring partners, Matthew Tait and Colin Haig, were appointed joint administrators of Theo Fennell Ltd yesterday.
Mr Tait said: “Unfortunately, the financial burden of certain fixed costs have weighed heavily upon the company as it implemented its own restructuring plan. Whilst the market has remained strong for fine and luxury goods, the cost and pace of that restructuring could not be supported by the company indefinitely. Given the long established reputation the company has built for fine craftsmanship it is not surprising that we are already in receipt of a number of expressions of interest.”
Theo Fennell employed 54 staff at the time of the administration but BDO said it has already had to trim the workforce.
“Whilst regrettably, it has been necessary to make some limited redundancies, it is the administrators’ intention to work closely with management to continue to service its valued clients whilst a long term solution can be found,” said Mr Tait.
The most recent annual accounts for Theo Fennell published on Companies House show that the company made a pre-tax loss of £2.5m on sales of £9.6m for the year ended 31 January 2016. In a review of the business, it said: “The strategy for the year was to significantly reduce the losses incurred in the previous year while maintaining the sales. This was in line with the objective of returning the company to profitability by 2018.”
Figures for the 2017 financial year have not yet been published.
Earlier this year, Professional Jeweller revealed how Theo Fennell was consolidating its business to concentrate on its core strengths by reducing its wholesale distribution and focusing on its London stores. As a result, it took the decision to remove its jewellery concession out of Harrods.
“We have always done best when we have concentrated on what we excel at, creating really original and finely crafted jewellery and silverware for our brilliant patrons and giving them a truly personal experience,” said Mr Fennell at the time. “Mass brand retail is no longer the go-to place for customers like ours who want something niche and different,” said Mr Fennell at the time.