Troubled vacuum seller Godfreys has warned shareholders “not to rely on previously published earnings guidance” as its new management grapples with cashflow problems.

“It is likely that there will be a further announcement about this in the near future and, in the event that forecast earnings differ materially from previously published earnings guidance, Godfreys will update the market to this effect,” the group told investors last night.

The group also warned the business “may, without further financial support, experience cash flow challenges in early July 2018” based on an initial review by the group’s new management.

Godfreys was working on extending a $30 million loan facility and was also considering raising money through a rights issue.

Meanwhile a takeover bid by Godfreys’ 99-year-old co-founder John Johnston had now reached 80 per cent acceptance, the group said. It needs 90 per cent to take over the business.

Mr Johnston, who launched Godfreys in Melbourne in 1936 with Godfrey Cohen — wants to privatise the business.

Godfreys Group shares (ASX:GFY) have lost 90 per cent of their value in the past three years.

The retailer reported a 27 per cent drop in like-for-like sales in April — which pushed sales down by 7.8 per cent in the year-to-date.

Godfreys Group shares (ASX:GFY) have steadily lost value in recent years.
Godfreys Group shares (ASX:GFY) have steadily lost value in recent years.