Ikea hit with 'tough year' here despite global gain
Swedish home furnishings giant Ikea conceded it had a "tough year" in Ireland in 2011, as the economic downturn continued to bite.
The more difficult conditions here were revealed by the group, who said its global profits jumped 10.3pc to just under €3bn in the 12 months to the end of last August.
Ikea said it gained market share in all the territories in which it operates, helping sales to rise 6.7pc to €25.1bn -- a record for the company.
Ikea's Dublin outlet, which opened in summer 2009, has been among the best performing of the company's European stores. Just a year after it opened, Ikea sought to boost the size of the store by 10pc due to strong trading.
But in a statement to the Irish Independent yesterday, the company, which is privately owned, said it had since experienced a more challenging environment.
"Low consumer confidence, coupled with difficult economic conditions, have resulted in a tough year for Ikea in Ireland," it said.
"Despite this, we continued to lower our prices by 5pc compared to the previous year and remained focused on giving our customers the best value-for-money home furnishings."
It added that it "remains confident" that its offering would enable it to strengthen its market position as a value-for-money retailer "during these difficult times".
The Dublin outlet made a pre-tax profit of €11.4m in its first full year of operation, ranking it among Ikea's top European stores.
Its outlet in Belfast, which Ikea opened in late 2007, has struggled with a decline in trading in the past year. It's been hit by a fall in sales due to the Dublin outlet opening and the impact of the economic downturn. It said last November that the trading pattern of the store had been "well below" what would have been expected of an Ikea outlet of its size.
Releasing its group annual update yesterday, Ikea chief executive Mikael Ohlsson said that the group opened seven outlets in its last financial year.
"Today, when nations and people face economic challenges, Ikea is more relevant than ever," he claimed.