WH Smith in the black, thanks to 'Fifty Shades of Grey' sales
Published 29/03/2013 | 05:00
Bumper sales of erotic novel 'Fifty Shades of Grey' helped the Irish arm of WH Smith record its first ever profit last year.
The UK-owned bookseller generated €541,658 in pre-tax profits, thanks in part to phenomenal sales of author EL James' sexually charged novels.
Last year's profit came after recording a pre-tax loss of €165,472 in 2011 – a positive swing of €707,130.
Revenues were up 59pc to €10.9m in the 12 months to the end of August 31, 2012, the accounts show.
James' erotic romance, and the second and third volumes, 'Fifty Shades Darker' and 'Fifty Shades Freed', were best sellers in the period under review, recording book sales of €2.8m across Ireland in 2012. The numbers employed by WH Smith increased from 37 to 52 and the increase in revenue is attributable to a full year's trading for the firm's four new units at Dublin airport.
The results also take account of the performance of the firm's first high street shop in Ireland, which was opened at Arnotts in Dublin in the year under review.
The profit last year takes account of non-cash depreciation costs of €297,599. Staff costs increased by 31pc from €874,301 to €1.15m.
Rent paid by the firm under operating leases increased from €1.7m to €2.9m last year.
The company's cost of sales increased from €3.47m to €5.5m, resulting in the firm's gross profit increasing from €3.39m to €5.31m.
Distribution costs rose from €3.5m to €4.7m, with administrative expenses falling from €41,541 to €35,532.
Accumulated losses fell from €548,825 to €42,728. The firm's cash fell from €2.69m to €819,233.
The accounts state the company is in receipt of a letter of support from the ultimate parent company to provide financial support for a period of no less than 12 months.
The note states: "With this support, there is a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future."
In 2009, WH Smith opened its first two stores at Shannon Airport before opening its outlets in Dublin Airport.
Last year, WH Smith globally recorded pre-tax profits of £102m on £1.24bn revenue.