British DIY retailer Homebase has entered administration, placing 2,000 jobs in jeopardy as the company grapples with a significant downturn in home improvement spending. The chain, operating approximately 130 DIY and garden centre outlets, appointed insolvency practitioners from Teneo on Wednesday after experiencing declining sales over three consecutive years.
Through a prepack administration deal, CDS Superstores, the parent company of The Range, has acquired up to 70 Homebase stores, along with the brand and intellectual property rights. The Range, which recently purchased the Wilko brand following its collapse, is poised to preserve roughly 1,600 positions through this acquisition.
The fate of 2,000 employees, including head office staff, remains uncertain as administrators seek buyers for the remaining 49 UK stores. Teneo has assured stakeholders that immediate redundancies are not planned, and customer orders will continue to be fulfilled where possible.
The retailer’s financial struggles are evident in its most recent results, posting a pre-tax loss of £85 million in the year to January 2023. Turnover declined substantially from £788 million to £701 million, with the company citing diminished consumer confidence and the cost-of-living crisis as primary factors.
Damian McGloughlin, Homebase’s chief executive, acknowledged the company’s extensive efforts to enhance trading performance, including business restructuring and investment pursuits. These initiatives ultimately proved insufficient to prevent administration.
The retailer’s market position has deteriorated significantly since 2015, when it held the position of second-largest DIY and gardening retailer in the UK. Industry analysts note that Homebase’s market share had more than halved by 2021, following a turbulent period under various ownership structures, including a challenging stint with Australian group Wesfarmers and subsequent acquisition by restructuring specialist Hilco for £1 in 2018.
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