Monday 16 July 2018

Elverys owner in finance warning

Gavin McLoughlin

Gavin McLoughlin

The company behind sports retailer Elverys Intersport has warned that it is more difficult to obtain bank finance and make acquisitions. That comes amid substantial pressure on retail despite the strong economy.

The company - West Roxbury Ltd - has just filed new accounts at the Companies Registration Office.

The accounts state that the business "operates in a cyclical industry and is affected by factors beyond the control of the company - for example the level of credit available from financial institutions".

In a statement dated May 30 2018, the company's directors said that "in common with all companies in Ireland operating in this sector, the company faces increasing difficulty in acquiring viable companies and obtaining bank finance".

However the directors believe the business is "well-positioned to manage these problems".

"The directors are optimistic as regards the future prospects for the company as a result of the upward trend in consumer sentiment coupled with an improvement in the general economic climate in Ireland," the accounts state, adding that the directors feel well placed to take advantage of any increase in demand.

Elverys was bought out of examinership by management a number of years ago.

The accounts, covering the year to the end of December 2016, show profit increased to €832,535 compared to €618,988. Turnover was up to €78.3m from €74.6m.

The results come in a gloomy time for retail, particularly in the UK where the sector is haemorrhaging jobs.

Last week British discount retailer Poundworld went into administration, putting 5,100 jobs at risk.

Private equity group TPG Capital, Poundworld's majority owner, put the discount retailer up for sale last month but has failed to find a buyer.

Administrator Deloitte said Poundworld, which operates 335 stores across Britain, would continue to trade while a buyer for all or part of the business is sought and there would be no immediate redundancies or store closures.

The news followed the collapse this year of Toys R Us UK, electricals group Maplin and drinks wholesaler Conviviality.

"The retail trading environment in the UK remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business," said Poundworld joint administrator Clare Boardman. "Unfortunately, this has not been possible. We still believe a buyer can be found for the business or at least part of it," she said.

Some other British retailers are closing stores including Marks & Spencer, fashion retailer New Look, floor coverings group Carpetright, and mother and baby goods retailer Mothercare. (Additional reporting Reuters)

Irish Independent

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