Claire’s Faces Spanish Setback: Local Branch Enters Pay Off

Claire’s puts an end to its business in Spain. The accessories company for children and teenagers has gone into pay off in the country, as published in the Official Gazette of the Mercantile Registry (Borme). The company sold its business in the United States in the summer, and entered into insolvency proceedings in France, the United Kingdom and Ireland. In Spain, it has not been able to overcome its crisis either.

According to the latest accounts published in the Mercantile Registry, Claire’s sales in Spain fell by 6.13% in 2023, the year ended January 31st, 2024. The company went from a turnover of €21.29 million in 2022 to €19.98 million in 2023. However, the operating result did manage to turn green. After a negative result of €3.57 million in 2022, the company closed its last fiscal year, in 2023, with a figure of €569,917.

The net result for the year also recovered in 2023, despite remaining negative. In 2022, the company closed its fiscal year with a loss of €3.5 million. In 2023, the loss was reduced by more than €3 million, but remained negative at €252,460.

Claire’s closed its last fiscal year with a turnover of €19.98 million, down 6.13%, and losses of €252,460

One of the factors behind the company’s liquidation is its debt, which has not decreased since 2022, when the company owed an amount of €15.9 million. In 2023, the figure increased by five million euros, to €20.75 million. Its equity, on the other hand, stood at negative €7.48 million.

“Economic conditions continue to negatively affect demand for our product,“ the company acknowledged in its latest management report, referring to the 2023 financial year. “However, management is committed to its strategy of maximizing sales opportunities,“ it added.

It also noted that the failure to grow its number of stores had a negative impact on the business. The company had 116 stores in Spain as of January 31st, 2024, three more than at the same time in 2023, Claire’s also appealed to “a decrease in the number of people going to shopping centers.“ On the other hand, it warned that “the global supply chain could be affected” by its high dependence on China.

In its latest management report, Claire’s pointed to the decline of its stores and the global context as the main causes of its numbers

Its global situation is also critical. In the United Kingdom, in September it sealed the sale of 156 stores in the UK and Ireland to the private equity firm Modella Capital, owner of WH Smith and Hobbycraft. This meant the rescue of half of the Claire’s network of stores in the British and Irish markets. Almost at the same time, the group declared itself in redressement judiciare in France (the equivalent of an chapter 11).

Claire’s has been experiencing, since 2018, difficulties that it has not been able to resolve. A situation it saturated with the sale of its North American business at the end of August, for an undisclosed price, following the decision to declare bankruptcy in the territory to try to reduce its losses. The company then cited a $477 million debt maturing in December 2026, falling consumption in the United States and rising costs due to tariffs.

Founded in 1974, the company defines itself as a shopping destination for jewelry, cosmetics, accessories and piercing for girls and teens between the ages of 3 and 18. In addition to the Claire’s chain, the company owns Icing, which targets an older audience.