Topshop tops for Arcadia as profits decline

TOPSHOP was the star performer in Ireland last year for retail group, Arcadia which saw pre-tax profits fall from £15.1 million (€17.1m) to £10.6m.

Turnover fell by 5% to £68m and gross profits were 30% lower at £10.6m with the company saying it found trading conditions in Ireland “extremely challenging”.

It said, in accounts just filed covering the year to the end of August 2009, that the Evans and Burton brands that target the mainstream market particularly struggled.

The company, Arcadia Group Multiples (Ireland) Limited operates clothing stores Burton, Dorothy Perkins, Evans, Topshop and Topman here.

“The young fashion brands such as Topshop proved more resilient, while the company continues to benefit from the strength of the euro relative to the sterling,” the accounts read.

The board said it remains optimistic that the ongoing investment in stores and product will contribute to the company’s objective to growing both total and underlying sales.

“Further improvement to the supply chain, including tight stock and commitment management, will be key to ensuring that gross margins are optimised going forward,” the accounts said.

The directors did not recommend paying a dividend in the year.

The company said the main risks facing it include the increasingly competitive marketplace and the sourcing of new ranges to satisfy its fashion- and value-conscious customers.

Staff costs in the year came to £14m, up from £12m in the previous year.

The average emoluments paid by the company to its directors was £22,000, compared with £14,000 in 2008. It said £15,000 of the 2009 pay related to the directors services to other group undertakings.

The company employed 936 people in the year, down from 945 in the previous year.