Losses climb to €20.6m at 11 Irish Debenhams stores
Troubled retailer employs 1,373 with hundreds more working in concession outlets
Debenhams at Henry Street, Dublin. Photograph: Eric Luke
Exceptional costs at the Irish arm of troubled retailer, Debenhams last year contributed to pre-tax losses rising to €20.64 million.
Debenhams operates 11 stores in the Republic and new accounts filed by Debenhams Retail (Ireland) Ltd show the company recorded the pre-tax loss of €20.64 million after incurring exceptional costs of €18.77 million.
The pre-tax loss in 2018 followed a pre-tax loss of €246,000 in 2017.
The business recorded a pre-tax loss of €1.86 million before exceptional items as revenues dipped by 1 per cent to €168 million in the 12 months to the end of September 1st last.
The directors state that “the external economic and commercial environment is expected to remain uncertain and volatile in 2019”.
Earlier this year, the Irish firm’s UK-based parent entity, Debenhams plc was placed under the control of administrators with the Irish business continuing to trade as usual.
However, the new accounts show that as a result of a strategic review of the Irish business carried out in the second half of the year, the company revised projections for all of its stores.
This resulted in impairment costs and onerous lease charges of €13.7 million after the review identified stores “at the risk of becoming unprofitable over time and others where anticipated future performance would not support the carrying value of store assets”.
The review also resulted in a non-cash impairment charge on goodwill of €3.38 million while an exceptional charge of €1.68 million was also incurred due to restructuring linked to Debenhams “Redesigned” strategy.
Sales at the company’s “bricks and mortar” stores totalled 83 per cent with 17 per cent of sales online. This compared to a sales mix of 86 per cent in-store in 2017 and 14 per cent online.
The number of employees fell last year by 81 to 1,373. The store network employs hundreds more working in concession outlets.