Courts confirms refinancing

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Courts, the furniture retailer, could spin off more overseas subsidiaries, the company revealed yesterday as it confirmed plans for a novel refinancing to bring forward profits.

Bruce Cohen, the chief executive, said further stock market floats "are something we might consider", possibly next year.

The group, which sells in 21 countries, is to issue bonds securitised against cash-flow from hire purchase agreements in its Far East businesses.

Mr Cohen said this would bring forward £60m of deferred revenues, and unlock up to £400m that would wipe out debt and leave it with £100m in cash. The first securitisation of about £40m was planned for Singapore, followed by an issue covering Caribbean receivables of about £110m. Courts' shares gained 7p to 285p.

In contrast to rivals such as SCS Upholstery, Courts unveiled sharply higher underlying sales in the UK. "We are taking market share," Mr Cohen said, pointing to a 26 per cent like-for-like sales increase in the past 14 weeks.

However, gross margins fell after the company cutprices and compensated customers for the late delivery of its new leather upholstery ranges. Courts was within 1 per cent of its targeted margin, Mr Cohen added.

Losses for the six months to 28 September widened to £5.6m from £4.1m in the year-earlier period, hit by adverse currency movements and amortisation of goodwill.

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