SHARES in SpaceandPeople, the shopping centre marketing firm, have fallen after it warned the closure of joint venture S&P+ will hit the group’s 2016 results.
The Glasgow-based company said S&P+, which operates in a niche sector outside the parent group’s core shopping mall business, pulled the plug on the venture after “substantial” business deals slated for June were “delayed and cancelled entirely by clients”.
The loss of those deals resulted in “considerable cash flow constraints for S&P+, leading the board to conclude that it was no longer prudent to continue funding the venture beyond that already provided”.
SpaceandPeople, which has a 51 per cent stake in S&P+, said it will write off a £425,000 loan it has provided to S&P+, as well as an inter-company debts of £50,000, resulting in a one-off loss of around £275,000. In addition, the £180,000 of pre-tax profit S&P+ had been expected to contribute will now be a loss of around £200,000.
Matthew Bending, chief executive of SpaceandPeople, noted that there would be an impact on jobs but did not specify how many roles would be affected. He said in a statement: “Obviously, we are very disappointed about this outcome and understand the impact this will have on the employees of S&P+, however, the core UK and German promotions and retail businesses are trading in line with our internal expectations.”
He added: “We do not see the decision on closing S&P+ as having any negative effect on the core business.”
Shares in S&P+ closed down 1.5p, or 3.3 per cent, at 43.5p.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here