Sarah Butler 

Carluccio’s and BrightHouse collapse into administration

Jobs of 4,400 staff in doubt as coronavirus lockdown hits high street
  
  

A BrightHouse store in Marlowes, Hemel Hempstead.
A BrightHouse store in Marlowes, Hemel Hempstead. The rent-to-own operator confirmed on Monday it has fallen into administration. Photograph: Jonathan Brady/PA

The Italian restaurant chain Carluccio’s and rent-to-own retailer BrightHouse both collapsed into administration on Monday, putting about 4,400 jobs at risk, in the first sign of the government’s coronavirus lockdown biting the high street.

Geoff Rowley, of FRP Advisory, who was appointed administrator of Carluccio’s on Monday, said he was hoping to mothball the business under the government scheme which would provide 80% of wages to its 2,000 employees.”

The chain’s 73 branches are already closed as a result of the government’s lockdown on all restaurants, cafes, pubs and non-essential retail, but Rowley said he hoped to find a buyer for all or parts of the business.

Rowley said: “We are operating in unprecedented times and the issues currently facing the hospitality sector following the onset of Covid-19 are well documented. In the absence of being able to continue to trade Carluccio’s, in the short term, we are urgently focused on the options available to preserve the future of the business and protect its employees.

Analysts believe a substantial number of restaurant, retail and leisure businesses will struggle to survive in the coming weeks. Mark Brumby, a hospitality and leisure analyst at Langton Capital, predicted that five or six firms could collapse this week alone. The coronavirus outbreak, he said, had “hit the industry like a brick”.

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BrightHouse’s stores were also already closed under the government’s coronavirus control measures but administrators said the business would continue delivering smaller items to homes and, where possible, would continue servicing items already in people’s homes.

Chris Laverty, Andrew Charters and Sarah O’Toole of Grant Thornton, who were appointed as joint administrators on Monday, said BrightHouse would not be making new rent-to-own or cash loan deals. They said existing clients should continue to make payments in the usual way.

The company – which sells household appliances and electrical goods on credit to primarily low-income customers – has been struggling for months after a regulatory crackdown on interest charges that reduced its income.

BrightHouse, which is owned by a trio of investment funds, Alteri, Apollo and Highbridge, said costly compensation claims by customers after the crackdown were costing it £1m every month.

 

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