€3.4m Virgin loss hits new owners
The Virgin Megastores business which was sold by Richard Branson last September posted losses in Ireland of more than €3.4m in the 12 months to the end of March last year, despite turnover rising to €37.9m from €29m.
The performance will mean the new owners -- former managers at Virgin -- will have to work hard to revive the chain, now known as Zavvi.
In the 12-month period to the end of March 2005, Virgin Retail generated an operating profit of €1.7m, but by the end of March 2006 still had retained losses of €8.6m. Those accumulated losses have risen to more than €12m.
Virgin and competitors have been hit by the trend towards online purchasing.
However, there may already be signs that an improvement is on the horizon.
In January, Zavvi managing director Simon Douglas said the group posted a 70pc increase in online sales in the four-week run-up to Christmas in the UK and Ireland. Total like-for-like sales rose 10.2pc.
Games sales were up 62.7pc on a like-for-like basis, with books and clothing sales up 45.2pc. Sales of DVDs rose 6.4pc.