Arnotts chief executive David Riddiford has vowed that the iconic Irish department store will record “healthy” EBITDA growth this year, despite the turmoil surrounding the business’s ownership.
Riddiford said the Dublin store, which is set to be taken over by state-owned Anglo Irish Bank and Ulster Bank following their petition to the European Union last week, was “performing well”.
He said: “The issue is the company is a retail and a property business combined. The retail part is doing fine but the property side needed to be written down. [The store] will make a healthy EBITDA this year. Last year was tough but the business is getting stronger year on year.”
Once the restructuring is completed, which is likely to wipe out the 55% shareholding held by chairman Richard Nesbitt and his family, the banks will continue to invest in the business, he added.
He said: “In the short term, the cash generated by the retail business can’t service the loan on the property business. But there is working capital. The banks have invested €2m (£1.66m) this year[in Arnotts]. Next year that will be significantly more.”
Arnotts has refitted the Henry Street store and introduced new concessions such as Reiss for autumn 10.
The banks, to which Arnotts owes about ¤250m (£207m), are likely to sell the business within 18 months to three years, said Riddiford.