Friday 21 September 2018

Dunnes takes flight from British market as Brexit costs bite

Retailer exits Scotland and leaves just one shop in England after closures

'According to reports in the local press the reason allegedly given to staff was that the group was
'According to reports in the local press the reason allegedly given to staff was that the group was "pulling out of the UK market with Brexit future costs being seen as the main contributor to their decision".' Stock image

Samantha McCaughren Business Editor

Irish retailer Dunnes Stores has effectively exited the British market, closing all its Scottish shops over six months, and shutting its second-last remaining shop in England yesterday.

Less than three years ago, Dunnes had five stores in Scotland and six in northern England and there were reports in Britain that the company was considering scaling up the business by acquiring an additional 40 stores.

However, over the past few months all five of the Scottish shops have closed down. Late last year, branches closed in Sauchiehall Street, Glasgow and Clydebank, while branches in The Forge Shopping Centre in Parkhead, Glasgow; Cumbernauld; and Glenrothes, Fife, closed in recent days and weeks.

The Cumbernauld premises was a flagship store in a shopping centre.

According to reports in the local press the reason allegedly given to staff was that the group was "pulling out of the UK market with Brexit future costs being seen as the main contributor to their decision".

In England, one of two remaining stores put up a notice in recent days to say it would cease trading on St Patrick's Day.

The shop in Heywood, Lancashire, based in the Times Retail Park, sold food, clothing and homewares. Local media reports said that Dunnes was "believed to be pulling all stores in England and Scotland".

The Heywood shop was removed from its list of stores on Dunnes Stores website on Friday, leaving Northampton as its only shop in England.

Retail sources said Dunnes Stores had an issue with scale in Britain and may have faced a decision to either ramp up or exit the market.

Dunnes Stores did not respond to queries.

The group continues to operate 16 shops in Northern Ireland, although it has closed several in recent years.

In 2016, Dunnes received a £250m dividend from its UK operation.

This move was seen as reducing sterling currency exposure due to continuing Brexit uncertainty.

The accounts showed the company recorded a pre-tax loss of £5.1m, though the main factor behind the loss was the firm writing down the value of assets by £7.5m.

It recorded the loss after revenues declined by 21.7pc - going from £127.56m to £99.85m.

Headed by Margaret Heffernan, Dunnes has completed a major corporate restructuring process by assimilating 40 individual companies into a principal entity.

Sunday Indo Business

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