Beleaguered Dublin department store Arnotts is on the brink of returning to operating profit after its management team introduced a raft of new collections and cut costs.
The Henry Street business is expected to post a single-digit turnover rise at its year-end on January 23 as a result of strategic changes.
The figure compares with a 25% slump in turnover to E120.7m (£102.5m) in 2009.
Womenswear and accessories recorded double-digit sales rises, partly due to recently launched brands such as Lauren by Ralph Lauren and LK Bennett. Chairman Mark Schwartz said EBITDA growth (EBITDA was £100,000 in 2009) would be significantly above the sales increase at year-end.
Chief executive Nigel Blow added there was “a chance” the business would end the current financial year with a positive operating profit but that greater strides would be made through 2011. He said: “We have seen things bottom out in 2010. It would be naive to be bullish about the first quarter of this year but we will see further positive EBITDA growth in 2011 and improved margins.”
Blow said Republic of Ireland consumers felt “more stable” now they had a better understanding of the Irish economy. In the 24 days to Christmas sales had fallen by about 5% because of the snow, but this was better than the Irish retail sector as a whole, which had complained of a 10% decrease.
The management stressed that, although its latest accounts showed a property write-down of E248.6m (£211m), the trading business was in much better health. Blow said: “It’s important to put that write-down in context. The trading business has improved profitability.”
Schwartz added: “The banks gave us their long-term commitment. We have a E10m (£8.5m) working capital facility that we haven’t even drawn down.”