Debenhams posts €16m profit after previous acquisition-related €17m loss

DEBENHAMS Retail (Ireland) returned to profitability last year in Ireland following massive pre-tax losses in 2007 which resulted from acquisition of Roches Stores.

Pre-tax profit at the retailer in the year to August 30, 2008, was €16 million which is a positive turnaround from the €17m loss recorded in the previous year.

Turnover was down slightly to almost €209m from €213m in 2007.

The accounts show there was a pre-tax loss from an exceptional item of €11.4m in the year ended September 1, 2007. This was the acquisition of Roches Stores in Ireland.

The company acquired the business and assets of nine Roches Stores outlets in September 2006 for €29m.

“The acquisition of the stores, assignment of the lease and subsequent closure of the Jervis Street store created an accelerated depreciation charge of €1,137,000 and redundancy costs of €6,719,000. Marketing, travel, legal and integration costs amounted to €5,110,000,” the accounts read.

The retained profit carried forward was more than €20m, up from €5.5m in the previous year.

Gross profit for the year was €27.6m from a loss of €7.2m in 2007.

Employee numbers were up from 1,826 in 2007 to 1,892 last year. As a result staff costs increased from €40.7m to almost €42m.

Earlier this week Debenhams globally announced a 10.7% year-on-year rise in half-year pre-tax profits to £104.2m (€116.7m) for the entire operations in Britain and Ireland.

Revenue for the six months to the end of February amounted to £1.31 billion – a 0.3% increase on the same period last year.

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