The Irish arm of retail giant Argos, which booked a €153 million impairment charge last year, returned to profit in early 2017 even as sales declined.
Argos Distributors (Ireland) Limited reported a €6.4 million pretax profit for the 12 months ending March 2017. This compares to a €153.8 million loss a year earlier.
The prior loss arose from the firm recording a €153 million impairment of its entire goodwill as a result of a review of the business in the light of the recommended offer by Sainsbury's for the purchase of the owner of Argos, the Home Retail Group. The supermarket giant subsequently acquired Home Retail for £1.4 billion.
Before the exceptional cost was taken into account, losses at the Irish unit had fallen from €2.56 million to €173,000.
Latest accounts
The latest accounts show the local subsidiary, which has 40 stores in Ireland, recorded a 3.4 per cent fall in sales to €219.8 million from €227.6 million.
Operating profit before exceptional items was €8.09 million, versus a €173,000 loss a year earlier. Argos said this reflected a decrease in net operating expenses and a rise in gross margin on reduces sales.
The company had nets attests of €240.1 million at the end of the reporting period, up from €232.4 million in their prior year.
Argos employed 1,024 people in the 12 months to the end of March, of which almost half were full-time. Employment costs were largely unchanged at €18.6 million.
