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Jan 29 (Reuters) - Card Factory Plc said on Friday it has secured waivers from its lenders to ward off covenant breaches until the end of next month, while it explores a range of potential solutions, including further waiver extensions.
The British card retailer warned of an annual loss earlier this month and said that its banking covenants would be breached at the end of January as a result of COVID-19 lockdowns.
Non-essential retailers across the UK have been battered by repeated COVID-19 restrictions and forced to shut shops under the latest lockdown, as Britain struggles to contain surging coronavirus cases and a new variant of the virus.
“Today’s news that constructive discussions with its banks continue is encouraging and we are hopeful that these will be brought to a positive conclusion in the coming weeks,” Liberum analyst Adam Tomlinson said in a note.
“While the group will clearly be impacted by store closures over the coming weeks and months, it was seeing improving trading trends prior to the latest lockdown”.
Card Factory, which has more than 1,000 stores across the UK and Ireland, has seen a jump in online sales during the pandemic but has kept its guidance for fiscal 2022 suspended.
Shares in the company were down 1.4% at 35.9 pence in early trade.
Reporting by Tanishaa Nadkar in Bengaluru; Editing by Rashmi Aich