Turnover up, after-tax profits down at Golden Discs

Music retailer Golden Discs has reported a 3% growth in turnover to €38.5m for the financial year to March 2004.

Profit on ordinary activities showed a marginal growth of 5% on the previous year at €860,000.

However, profits after tax decreased on the previous year to €470,000 due to Golden Discs' withdrawal from lease agreements on quitting the Northern Ireland market to concentrate on its core business in the Republic.

Increased location costs and employee expenses eliminated growth in gross margin, the company said.

Golden Discs employs more than 200 people in 27 stores in the Republic. The company is set to open its 28th store in late February in Mahon Point Cork and is preparing to relocate its outlet at Wilton Shopping Centre, Cork to a larger unit.

According to Golden Discs CEO Tony Killoran the company continues to look at other prime locations across the country to expand its network of stores.

"While we regard prime locations as crucial to our business, there is a significant price to be paid for these outlets," he said.

"The past two years has also seen a very significant increase in our rental costs – up to 100% in some locations – and this has in turn impacted on the growth in gross margin."

Golden Discs' revenue was bosted by increased sales in games and DVDs.