Electronics retailer Harvey Norman has estimated losses from its Irish business may reach as much as A$50 million (€30.8 million) in the year ending June.
"It's going to be somewhere between A$35 million and A$50 million," chairman Gerry Harvey said in a telephone interview today. "Ireland is very, very difficult."
Mr Harvey is facing his second straight year of losses from the 14-store unit as the Irish market battles a recession that's pushed unemployment to a 14-year high. Slumping demand led the Sydney-based retailer to post first-quarter sales growth that lagged behind smaller rival JB Hi-Fi, pushing its stock down the most in nine months.
Revenue from stores open at least a year rose 2.1 per cent in the three months ended September, one-quarter the 8.4 per cent pace Melbourne-based JB Hi-Fi reported this week.
"The market got excited about the stock, partly off the back of the JB Hi-Fi result," said Grant Saligari, an analyst at Credit Suisse Group AG in Sydney. "We have seen Harvey trade up strongly over the past week but this is an OK number they have put out."
Harvey Norman shares dropped 6.7 per cent to A$4.44, their largest decline since January 23rd, at the close of trading after earlier shedding as much as 12 per cent. Before today, Harvey Norman shares had gained 8.2 per cent this week.
Total first-quarter sales rose 4.3 per cent to A$1.5 billion and Gerry Harvey expects similar growth in the December period.
Revenue from Australian outlets rose 5.8 per cent for the September period.
Bloomberg