Kingfisher’s Irish Unit Gets Court Protection as Sales Slump
The retailer, which entered Ireland 11 years ago, appointed PricewaterhouseCoopers LLP as interim examiner for the chain, giving it protection from creditors, Kingfisher said today.
Nine of Kingfisher’s more than 1,000 stores are located in Ireland, where sales have slumped amid rising unemployment and falling house prices. The chain generated sales of 80 million pounds ($126 million) last year, compared with group revenue of 10.8 billion pounds, Kingfisher said.
“The management team is hopeful that a sustainable business can emerge from the examinership process, based on a restructuring of the company,” B&Q Ireland Chairman Brian Mooney said in an e-mailed statement.
The chain will continue to trade, and all pre-paid goods and services will be honoured along with gift vouchers and credit notes, the company said. At least two stores will close and another two may shut as it renegotiates leases.
Irish retail sales have fallen by about 20 percent since 2008, according to the Central Statistics Office, as home prices plunged, unemployment almost tripled and the government raised taxes and cut spending to narrow the largest deficit in western Europe. Last year, consumer sentiment fell the most in the 17- year history of an index compiled by KBC Bank Ireland and the Economic and Social Research Institute.
Irish landlords will force more retailers “over the edge” with a policy of upward-only rent reviews, trade organization Retail Excellence Ireland said in an e-mailed statement today.
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