WH Smith (SMWH.L) is in discussions with landlords, and has asked for rent reductions, as it struggles to contain losses due to the coronavirus pandemic according to reports.
The high street chain has drafted in its property adviser, Gerald Eve, to negotiate deals with property owners, according to a report in The Sunday Times.
The company has been a rare success story of recent years in retail, having implemented an aggressive expansion plan overseas into airports and train stations.
On Wednesday, WH Smith announced up to 1,500 staff could face redundancy, as it warned sales remained well below pre-crisis levels.
It marks the latest in a string of well-known UK firms to announce mass job losses in recent months, with Pizza Express and Hays Travel among them in the past week alone.
The company, which dates back to 1792 started as a newspaper seller. It said total revenues in July were down 57% on a year earlier, despite the easing of UK lockdown rules.
High street revenue has recovered better than sales at airports and train stations, with sales down 25% and 73% respectively, according to a trading statement.
The company said it had taken the “difficult decision” to review its store operations, and had begun a consultation with staff on a proposed restructure. It said the plans would cost between £15m ($20m) and £19m, “reflecting the group’s enhanced redundancy policy.”
According to The Sunday Times, the negotiations sparked anger from some property owners, who argued that the chain should pay the full amount as they aren’t yet insolvent.
“Like all retailers, WH Smith has been impacted by Covid-19, and footfall remains depressed,” the company told The Sunday Times. “We are working collaboratively with the vast majority of our landlords.”