Debenhams: 'No option' but to shut 11 stores in Republic after Covid-19 shutdown added to losses

Debenhams Ireland said yesterday it had applied to the court for the appointment of joint provisional liquidators, Kieran Wallace and Andrew O’Leary of KPMG.

Debenhams Ireland said it had “no option” but to shut permanently its 11 outlets in the Republic with the loss of at least 957 directly- employed jobs because it was loss-making for a number of years.

The British department store announced earlier this week it would not reopen when the Covid-19 retail lockdown ends and said it planned to liquidate the company.

Politicians and unions — which estimate that up to 2,000 direct and indirect jobs through concessionaires and suppliers will be lost by the closure decision — were angered because its parent firm had chosen to wind up its business in the Republic, but gave its business in the North and in Britain some chance of survival by seeking to put the operations there into administration.

Separately, the owner of Oasis and Warehouse in the Republic also announced this week plans to liquidate its operations.

Debenhams Ireland said yesterday it had applied to the court for the appointment of joint provisional liquidators, Kieran Wallace and Andrew O’Leary of KPMG.

It had “no option” but to close down after posting losses for a number of years. It had posted a loss of over €21.6m in its latest financial year — for the 12 months to the end of September 2018 — and the Covid-19 lockdown had made matters worse, it said.

“In common with the rest of the Debenhams Group in the UK, the group’s Irish operations have experienced very difficult trading conditions in recent years,” Debenhams Ireland said.

“The business has been consistently loss-making and has relied on its parent company for ongoing financial support. Despite entering into an examinership process in Ireland in 2016, the business has continued to make losses,” it said.

“However, even assuming that very significant cost savings could be achieved — for example, through temporary state supports for employees and agreements with landlords to grant rent holidays — the company projects that it would continue to experience heavy cash outflows.”