Partner Article

Dealership focuses on North East

A caravan dealership is to focus on its North East outlets after announcing heavy losses will cause store closures and redundancies.

Discover Leisure, based in North Newbald near Hull, have had to shut two thirds of their outlets after disclosing £9.2m losses in the past six months.

The ‘leaner group’ will focus on five of its larger sites, including sites at Darlington, York and Birtley.

Discover Leisure’s chief executive Trevor Parker said: “Store closures and redundancies are regrettable, but this bold, pro-active action gives stability to our company and puts us in a better position to ride out the current recession.”

He added: “Discover will continue trading through our five northern premier retail outlets including our Darlington site at Burtree Gate that has enjoyed a tremendous start to our busy season.

“The overall market is significantly reducing year on year and as a result simply cannot sustain the current level of outlets.”

Discover Leisure blame a 39% drop in demand for new motor homes, and will use the cost-cutting measures to generate cash in an oversupplied market.

They are seeking a Company Voluntary Arrangement (CVA) with their creditors, which will allow them to carry on trading while repaying their debts over a set period of time.

The company has agreed principle terms with their banks for an £8m loan secured against their five remaining retail outlets.

Mr Parker said: “We are currently enjoying a positive trading performance at the start of the high season, external pressures are such that certain areas of our business were not geared for growth or indeed survival and, as such, put the entire company at risk.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .