Groupon losses fall sharply to €62.1m

Pre-tax losses at the Irish unit of international online ‘daily deal’ firm Groupon last year declined sharply to €62.1m.

New accounts just filed with the Companies Office show that the US firm almost tripled the size of its Irish workforce during the year to 31 and has added further staff since year end. To facilitate growth here, the accounts also disclose that the firm received a cash injection of €12.1m last year.

Groupon International Ltd has also since signed two long-term leases on properties in Dublin, including a data centre.

The figures show that revenues increased almost six-fold last year to €75m.

The online ‘daily deal’ business was launched in November 2008. Last year was a record year for the firm, as it enjoyed global revenues of $2.6bn, resulting in operating income of $76m based on 140,000 daily deals, globally.

However, high non-cash amortisation costs of €64.8m at the Irish arm contributed to its losses last year, following a €134m loss in 2012.

According to the directors’ report, “the loss from operations declined significantly as royalty income increased to €62.5m. The increased royalty income was still less than the amortisation of intangible assets of €80.8m. As of the end of 2013, the net book value of intangible assets was €2.6m and future amortisation, excluding any additional acquisitions, is expected to be much lower”.

The directors view the results of the company as satisfactory.

The Irish firm licenses its intellectual property to affiliates and performs functions, including marketing.