Carphone Warehouse’s Irish unit reports huge jump in pre-tax losses
Losses rise to €12m from €2.5m due to costs associated with Dixons merger
Carphone Warehouse Ltd said costs associated with the merger totalled €3.65 million last year
Losses at Carphone Warehouse’s Irish subsidiary jumped sharply last year due to costs linked to its merger with Dixons, newly filed accounts show.
Carphone Warehouse Ltd, the Irish arm of the European-wide retail group, reported a €12 million pre-tax loss for the 12 months ending April 2016, versus a €2.5 million loss a year earlier.
Accumulated losses rose to €50.6 million from €38.6 million in the prior year.
Turnover at the group, which announced a £3.8 billion (€4.4bn) “merger of equals” with Dixons in May 2014, slipped to €114 million from €123.6 million as it recorded a €10.9 million operating loss.
The shareholders’ deficit totalled €5.3 million, as against a €6.7 million surplus the previous year.
The latest accounts show gross profit fell to €28.8 million in 2016 from €33 .5 million a year earlier.
Following its link-up with Dixons, the new group rolled-out a new 3-in-1 store concept that entailed merging remaining PC World and Curry stores and inserting a Carphone Warehouse outlet, in a move that reduced the group’s UK and Ireland store portfolio by 76.
Carphone Warehouse Ltd said costs associated with the merger, which included “early lease termination premiums, onerous lease provisions, fixed asset impairment and redundancy costs”, totalled €3.65 million last year.
The retailer had operating lease commitments totalling €74.4 million at the end of April 2016, down from €80.6 million a year earlier.
The number of people employed by the firm slipped to 729 from 749 with staff costs falling to €18 million from €19 million. Directors’ remuneration rose to €416,811 from €320,631.