Shareholders to get no dividend as recession adds to losses at Clerys
Published 23/06/2010 | 05:00
The recession catapulted losses at department store operator Clery & Co to almost €1.9m in the 12 months to the end of last January from just over €308,000 the previous year as gross sales at the group tumbled 26pc, or nearly €18m, to €51.3m.
The retailer is paying no final dividend in respect of the year to its shareholders.
The Guiney family acquired Clerys in 1941. Allied Irish Banks also owns an 18pc stake in the business.
The performance by the retailer, which operates an iconic store on Dublin's O'Connell Street, came as consumers battened down the hatches in an effort to ride out the sharpest economic contraction witnessed by the country.
The company also owns Guineys on Talbot Street and operates Clerys' outlets at Blanchardstown and Leopardstown in Dublin, and Naas, Co Kildare.
Accounts just filed at the Companies Office for the retailer showed that its net turnover, which excludes VAT and sales by concessionaires, slumped 30pc to €21.4m, while other operating income, which comprises income earned from concessionaires, fell almost 20pc to €4.7m.
Chief executive PJ Timmins told the Irish Independent yesterday that it was too early to say how trading in the current financial year would pan out, particularly as the Christmas period accounted for such a significant part of annual sales.
He added that he would be "much more confident" for the remainder of the year, however, than he was during 2009. The accounts note that a return to sales growth is not anticipated until late 2010 or early 2011.
Last year, Clerys sought to introduce a raft of changes in an effort to cut costs, including reduced working hours and plans to introduce a four-day week in order to prevent compulsory lay-offs.
The company also eliminated bonuses and slashed staff sales commissions.
Mr Timmins declined to elaborate on what changes were imposed in recent months, but said the group came up with a "whole lot of innovations".
"The emphasis is on preserving jobs," he added.
Total wages and salaries paid at the group fell 14pc last year to €6.8m.
Operating expenses fell nearly 16pc to €2.6m.
Directors' notes to the latest set of accounts show that consumer spending has been hit by significant rises in personal taxation and unemployment.
The accounts add that the trading environment "worsened considerably" as 2009 progressed and that pre-Christmas trade and post-Christmas sales were disappointing.
"All of our subsidiaries have been negatively impacted by the slowing demand for household products with the collapse in the housing market," added the accounts.