Aquascutum, the high-end clothing brand, is in a state of uncertainty regarding its future as auditors from Grant Thornton have issued a warning that the company might not be able to sustain its operations without securing additional financing. The latest financial accounts reveal that Aquascutum’s liabilities surpass the value of its total assets by £27.6 million, raising concerns about its ability to repay debts. Nevertheless, the Chinese owner of the company, Shandong Ruyi Technology Group, has guaranteed that it will provide the necessary funding to meet Aquascutum’s obligations.
Despite this reassurance, Shandong Ruyi Technology Group is grappling with its own set of challenges. Formerly praised as the LVMH of China, the Chinese textile manufacturer has amassed substantial debts after engaging in a multi-billion buying spree over the past four years. Notable acquisitions made by the conglomerate include Swiss handbag maker Bally, France’s SMCP, and Japanese suit brand Renown. Additionally, the company has been taken to court by a Portuguese supplier to Aquascutum for unpaid invoices worth more than £155,000.
In the nine-month period leading up to December 2018, Aquascutum reported a loss of £3.7 million on sales of £5.83 million. These financial struggles, coupled with auditors’ warning, highlight the obstacles that the renowned clothing label is currently facing. Nonetheless, with the support of its Chinese owner, Aquascutum remains optimistic about securing the necessary financing to overcome its current financial hurdles and continue its operations. The company’s long-standing history and reputation in the fashion industry may serve as attractive factors in enticing potential investors to aid in its recovery.