Beleaguered Alexon has a fight on its hands if it is to survive in tact this year, after it revealed a dire full-year performance.

The retailer’s plunge in to the red was largely due to the performance of its young-fashion brand Bay Trading, where £7m-plus losses dragged down the rest of the fashion group.

The day before it posted results on Wednesday, Alexon announced that it had rebuffed a takeover approach for the group, without knowing the price or terms. Speculation remains about who made the approach and what they thought they could achieve with a business that has rested too long on its laurels.

The Alexon board believes the offer was not serious and said that chief executive Jane McNally – who was parachuted in last June – and her team need time to turn the business around.

There is no doubt that McNally has the credentials to succeed, but does she have the luxury of time?

McNally, who has worked at young-fashion giants Primark and Peacocks, and her right hand woman Jane Eskriett have been working hard to reposition Bay Trading and work on its Ann Harvey brand.

McNally has the wherewithal to inject some new handwriting into ranges – which she says have been well-received – and vastly improve their image in fashion circles.

However, the group has reached a critical point. In the full-year results it highlighted that there can be “no certainty that the actions taken will improve the business”.

Market place rumours signal that there is a sales document in circulation for Bay Trading. Speculation abounds that it could also be put in to administration. McNally herself has highlighted that Bay Trading is operated as a separate company and that she won’t allow its performance to drag the rest of the business down. She said that an unspecified “back-up plan” is in place.

If any of those back-up eventualities do come off, it would mean that Bay Trading would go the way of a string of its predecessors – for example, Style Menswear, Dolcis and Envy. All have fallen by the wayside and out of the Alexon stable, leaving the remaining businesses – and Bay Trading, with its standalone store portfolio in particular – an unwelcome legacy of leases under privity and empty space within stores.

It represents the ongoing slow breakdown of a business that has remained still for too long under previous management. A major repositioning and significant investment is needed.

And what would become of the Alexon group without Bay Trading? The retailer’s remaining brands, which include Eastex, Dash, Minuet, Kaliko and East & Co, are mainly concession driven businesses. While their niche positioning in petite, mature and larger-sized sectors looks assured, they too have sexier competitors snapping at their heels.

McNally has a large task at hand if she is to achieve her plans and keep the cynics at Bay.

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