Shares in Next PLC (LON:NXT) were down on Friday after the clothing retail giant has been forced to sell its headquarters and three warehouses to help the business cope from the lack of sales in the coronavirus pandemic.
The FTSE 100 group hopes to raise around £100mln from the sale and lease-back of its head office in Leicestershire and, separately, three warehouses in West Yorkshire.
READ: Next closes online operations to let all workers isolate
Chief executive Simon Wolfson said he expected the sales would "secure the cash resources of the business" for the future as it took "all the measures" to protect itself.
Having closed all its stores earlier last month, last week Next was also forced to stop taking online orders as it shuttered all its warehouses and online operations after staff raised concerns about their safety during the pandemic.
Earlier in March, Wolfson said Next could sustain the loss of 25% of annual sales or £1bn, according to a stress-test forecast where the coronavirus lockdown was sustained for 24 weeks, though this only modelled for zero sales for four weeks, with sales beginning to pick up after two months.
The company's stress-test of various scenarios, with a fall in annual sales of 25% resulting in profit before tax dropping to £55mln, including the benefit of a business rates holiday from the government.
“We believe the -25% scenario is overly pessimistic,” management said at the time, saying scrapping the dividend for both 2020 and 2021 was “a last resort”, although it delayed its next payout until sometime between August and October.
Next mentioned at the time that it was considering selling and leasing back warehousing and other property.
The new developments are that Savills has been appointed agent for the HQ sale and Acre are the agent for the warehouse deal.
A spokeswoman said the sale and leaseback of these properties has "absolutely no effect on staff or stores".
Next shares were down 4% to 3,475.75p by late Friday morning, down 50% in the year to date.