Eason posts losses but shareholders' dividend restored

IRISH-OWNED retailer Eason restored its dividend to shareholders last year in spite of recording another year of losses as consumers continued to tighten their belts in the recession.

Accounts provided to The Irish Times show that Eason and Son Ltd made a loss of €5.3 million in the year to the end of January 2012 after booking exceptional costs of €13.4 million relating to property assets in Belfast and a redundancy programme.

This compared with a loss of €4.4 million in the previous year.

Turnover fell by 10.7 per cent to €266.1 million as sales of books, newspapers and stationary continued to decline on the island.

About €14 million of the fall in sales related to its exit from South Africa.

However, the retailer is gaining market share.

The like-for-like decline in its sales in the Republic was 4.6 per cent last year compared with a decline in the market as a whole of 10 per cent.

There was good news for its 230-plus shareholders – comprising Eason family members and current and former staff – with the retailer paying a dividend for the first time since 2008.

They will receive 5 cent a share, which amounts to a payout of €1 million by the group.

Eason has undergone a major reorganisation in the past few years by trimming its cost base and investing about €20 million in upgrading its IT infrastructure, revamping its stores and launching into the online market.

It has also exited underperforming businesses in South Africa and the UK.

Late last year it agreed a new €23 million loan facility with Barclays Bank.

Eason is close to concluding a voluntary redundancy scheme that was oversubscribed and will result in 244 full- and part-time staff leaving the payroll.

This will achieve cost savings of €6.1 million a year.

Managing director Conor Whelan said current trading is “still extremely challenging”.

The overall market has declined by about 8 per cent so far this year with Eason recording a fall of about half that level.

“I’m confident that in the second half of the year there may be some improvement,” he said.

He said its Northern Ireland business was “performing in line with last year”, helped by the opening of a new flagship store at Donegall Place in Belfast.

“Our online sales are increasing and we’re hoping that our airports shops are bottoming out,” he added.

Sales from its airports shops fell by 36 per cent to €10.7 million last year due to the opening of Terminal 2 in Dublin, which affected Eason’s shops in Terminal 1.