Associated Hardware posts €460,000 loss as construction decline takes toll

THE BUILDING slump and increased interest payments to its banks left independent builders’ merchants and DIY group, Associated Hardware, with a €460,000 loss last year.

The group recently filed accounts with the Companies’ Registration Office (CRO) showing that turnover fell to €158.7 million in 2008 from €205.9 million the previous year, a fall of 22 per cent.

Its operations lost just over €115,300 in 2008 compared with a €775,850 gain the previous year. However, the figures show that interest payments on its bank loans and overdrafts increased to €358,700 from €220,600.

It ended the year with a loss before tax of €461,800, compared with a profit of €580,600 in 2007, the year which marked the end of the building boom.

Associated Hardware buys products from suppliers and sells them on to its members, who are largely independent builders’ merchants. It also operates retail businesses through its Homevalue and Parabuild subsidiaries.

Its accounts blame the impact of last year’s difficult economic conditions and in particular the decline in house-building on its members – which had a knock-on effect on its business – for its 2008 losses. “This adverse impact is likely to continue for the whole of 2009,” the company warns.

After tax charges were taken into account, the group had a loss for the year of €516,800, compared with a profit of €480,000 in 2007.

A loss of €410,000 on its pension fund investments forced it to recognise losses for the year of more than €926,000.

The group had an overall deficit in its pension fund of €528,700 at the end of the year. That shortfall is based on all members and contributors simultaneously taking up their entitlements.

The group operates defined benefit and defined contribution schemes for its staff.

A large number of defined benefit pension schemes ended last year in the red as a result of dramatic falls on world investment markets.

Shareholders’ funds at the end of the year were €8 million, down from €8.9 million 12 months earlier.

The group had total assets of €13 million and €6 million in the bank.