Poor trading means that online retailer EBTM is running out of cash.
Shares in EBTM dived 0.85p to 0.28p each, which values that music-based fashion retailer at £970,000. EBTM raised £850,000 at 1p a share in November 2008.
The previous month EBTM sold the Lowlife brand and said that this would help it achieve forecast profits in the year to April 2009. Prior to the trading statement the profit forecast was £1.7m.
December online sales fell by one-third so EBTM may find it difficult to achieve any profit this year if trading does not improve. Website traffic has been disappointing and gross margins have declined. The wholesaling business remains tough.
Management says it may sell all or part of the group. Certainly, raising money to continue to finance the ongoing business will be difficult.
Quentin Griffiths stepped down from the EBTM board on 8 December 2008. He was one of the founders of ASOS as well as EBTM. He might even be interested in buying the online retail business.
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