GameStop’s closure of Irish business cost about €13m

Shutting down the Irish arm of video game retailer, GameStop, cost about €13 million, the company estimates.

GameStop announced the closure of its 35 store network here in March. The business shut down on June 24th, along with its online presence, with the loss of 224 jobs.

A note attached to accounts for GameStop Ltd recently filed says costs connected to the closure are estimated to be approximately €13 million. That includes severance costs, reduction in lease liabilities and impairment of right of use assets etc.

The accounts show that the Irish business – owned by the Texas-headquartered GameStop Corp – continued to be loss-making ahead of the closure, with the firm recording pretax losses of €5.35 million in the 12 months to January 28th this year as revenues dipped marginally from €40.36 million to €40.24 million.

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Revenues at GameStop Ireland had been boosted during the year by sales of Fifa 23; Call of Duty: Modern Warfare 2; God of War; and Grand Theft Auto 5.

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The accounts – signed off on June 30th last – show that the business reduced its operating losses by 30 per cent from €2.46 million to €1.72 million last year. Interest costs of €3.62 million brought those loses up to €5.35 million at the pretax level. The pretax figure marked an 11 per cent improvement on losses of €6.039 million in the prior year.

Accumulated losses in the business at the end of the last financial year were €45.5 million, with a shareholders’ deficit of the same amount.

The losses take account of non-cash depreciation costs of €2.1 million. The firm’s cost of sales totalled €30.46 million in addition to €9.16 million in administrative expenses and €1.66 million in “other operating expenses” – management fees charged by related companies.

Staff costs increased from €4.6 million to €5.2 million, including salary costs of €4.51, up from €4.12 million. Staff numbers comprised seven in management and 217 direct employees.

Severance costs this year totalled €183,532.

At the end of January this year, the firm owned €52.25 million to GameStop Global Holdings.

Globally, GameStop’s revenues last year dipped to $5.92 billion (€5.6 billion) from $6.01 billion. Globally, the business lost $302.1 million last year.