Harvey Norman narrows Irish losses to €19.4m

The managing director of the Irish operation of Harvey Norman said yesterday he expects the business will narrow its losses further in 2013.

Blaine Callard was commenting on new accounts lodged with the Companies Office that show the Australian-owned business recorded an underlying loss of €19.4m in the 12 months to the end of June last — down from the €22m loss recorded in 2011.

Mr Callard said that for the nine-month period since the end of June last year, Harvey Norman in the Republic and Northern Ireland had the strongest like-for-like sales growth of any region globally for Harvey Norman.

Sales increased in the Republic by 8% on the previous year during the nine-month period with sales rising by 11.2% in the North.

Mr Callard said: “We continue to narrow our Irish losses and expect further loss reduction in the 2013 financial year. Harvey Norman remains fully committed to our Irish operation. We will continue to assess the viability of every location and ensure our retail network is fit for purpose.

“Whilst some Irish landlords have made modest rental concessions, many have not. We are determined to correct the distortions of boom- time upward only rents.

“In a very difficult economic and retail environment, we continue to grow sales in our Irish operation. There is little indication of an improvement in consumer confidence or an upturn in the retail environment, rather we have been taking market share from competitors.

“Several factors have contributed to our sales growth. Over the past three years, we have invested heavily in building and repositioning our brand both as a technology brand and a quality and homewares store.

“During 2012, we upgraded several of our stores... we also opened a second Dublin flagship furniture and bedding concept store in Blanchardstown which is performed very strongly.

The filings lodged by Harvey Norman Holdings (Ireland) Ltd show the firm recorded a pre-tax profit of €19.2m that arose from a group Advance Pricing Agreement that provided for a reimbursement of €39.6m.

However, the underlying loss was €19.4m. Revenues increased from €139m to €147m. The numbers employed by the group last year increased from 776 to 828 with staff costs increasing marginally from €25.2m to €25.5m.

The filings show that underlying loss last year took account of non- cash depreciation and impairment charges totalling €2.46m with directors’ remuneration increasing from €772,949 to €823,876.