Nisa Retail has secured an increased and extended banking facility with Barclays on the back of improved trading during the current financial year.
The new two-year facility comes after EBITDA for the first half of the financial year hit £3.3m, with the management team predicting an eventual profit of £7.2m for the full financial year.
After last year’s posted loss of £7.2m, a number of suppliers lost confidence in the group because they were unable to obtain suitable credit insurance, leading to shortages for key lines such as tobacco. However, more profitable trading since then means that Barclays extended its banking cover last month in a two-year agreement.
Nisa chief executive Nick Read said: “In April, we were in a tough position. Losses were worse than expected, and one third of the group’s net asset value had disappeared. Without insurable credit, suppliers are unable to supply us, and so a secure banking facility gives confidence to the market.
“We are doing this for the benefit of the members,” he continued. “The reality is, we have to make a profit for the bank, and we need reserves on the balance sheet so that our banking partners have confidence in us as a business. And we need a strong balance sheet if we want to continue to grow, and to invest in things like IT.”