Fears over the future of flooring retailer

Fears are growing for the future of retailer Floors-2-Go, as the flooring specialist asked staff to attend an "urgent" meeting at 11am this morning.

Administration is thought to be one of the options the 135-store flooring specialist is considering, although it is unclear exactly what was said at this morning's hastily arranged meeting. However, industry sources have speculated that the retailer's management are also trying to secure additional funding.

It was reported this weekend that Floors-2-Go's banker, National Australia Bank, has appointed restructuring firm Kroll.

Last month, Jon Moulton, founder of Alchemy Partners, which owns Floors-2-Go, denied that the retailer was heading for a financial crunch.

On June 25, Moulton said that Floors-2-Go's debt position was "fine" and denied speculation that it was about to appoint a restructuring firm to help it through what he called "torrid" trading in the home improvement sector.

However, a source close to Floors-2-Go said that trading had deteriorated. He said that sales for the week ending yesterday, July 20, had fallen below £1 million, which is below the £1.6 million it normally takes. "Trading has got worse," he said.

Alchemy Partners and Kroll were unavailable for comment.

Alchemy Partners backed the £52.4 million acquisition of Floors-2-Go in December 2006.