Poor figures force Flying Brands site sale

Flying Brands, which owns the Gardening Direct brand, has sold its Meadow Springs bedding glasshouse on Jersey to Jersey Choice (Jersey Plants Direct) through CB Richard Ellis for £1.225m.

The listed home shopping specialist, which is part owned by Sir Tom Hunter, said using the glasshouses only to grow spring bedding was inefficient.

The group's remaining glasshouses will now be used to grow more bedding and will buy additional products from third parties in spring.

Flying Brands has been performing poorly recently and a statement read: "Difficult trading conditions with performance in all divisions being below management expectations has led to pressure on the company's banking covenants. "The board has been seeking ways to realise the value inherent in the assets and businesses of the company both to ease short-term cashflow difficulties and also to enhance shareholder value. The disposals are the first steps in this strategy."

Chief executive Stephen Cook added: "The bulk of the proceeds will be used to pay down debt and thus strengthen the financial position of the company. We continue to explore ways of securing additional working capital should the board consider this to be necessary or desirable."

The end of the low value consignment relief VAT break for the Channel Islands on 1 April 2012 (HW, 18 November) is set to cause prices into the mainland to rise.

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