Sunday 24 September 2017

Home Retail Group hit by £852m charge after Argos takeover

There are Argos and Homebase stores across the island of Ireland
There are Argos and Homebase stores across the island of Ireland

Argos owner Home Retail Group has reported a full year pre-tax loss of £804m after being hit with an £852m exceptional goodwill impairment charge relating to the Sainsbury's takeover of the high street retailer.

Stripping out the charge, annual operating profit slumped 28pc to £94.7m and sales across the group were down 1pc to £5.6bn.

The exceptional impairment charge relates to Argos's prior ownership under Great Universal Stores, which acquired the business in 1998.

The group said: "The recommended offer from Sainsbury's for the purchase of Home Retail Group resulted in an exceptional goodwill impairment charge of £852m."

Earlier this year, supermarket Sainsbury's struck a deal to acquire Argos for £1.4bn and the deal is expected to complete before September.

John Walden, chief executive of Home Retail Group, said: "The group ended the year with a cash balance of £623m, which is significantly stronger than previously anticipated.

"The past year has been a landmark period for the group, during which we have completed the sale of Homebase and recommended to shareholders the offer from J Sainsbury for the acquisition of the remaining group, principally Argos."

The group sold Homebase to Australian retail giant Wesfarmers for £340m in January.

Press Association

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