Homebase plans to close stores
Published 16/07/2013 | 13:03
DIY giant Homebase Ireland plans to shut three stores after the company was forced into examinership.
The homes and garden retail chain said it will continue trading as normal during the process to put it on a better financial footing. But it warned it must consider closing some stores if it is to have a "reasonable prospect" of survival.
Outlets at Fonthill, Carlow and Castlebar, which employ 17 full time and 79 part time staff, have been earmarked for closure.
Homebase Ireland employs 558 people across 15 stores in the Republic. Some 114 workers are full time and 444 are part time.
Examinership is granted by the High Court and allows companies legal protection against creditors while they try to improve their finances.
Homebase Ireland said it was forced into seeking the protection as a result of the recession. Less disposable income, a reduction in new house builds and people spending less on repairs, maintenance and improvements had all taken their toll on the retailer, a spokesman said.
The DIY chain has been hit with a 31% drop in sales since 2009 and has been unprofitable for each of the past five years.
"In addition, Homebase Ireland's ability to reduce operating costs has been restricted by the existence of upward only rent reviews on its store leases," the spokesman added. "This is a situation that can no longer be sustained."
Homebase Ireland said workers will continue to be paid during the process and all customer ordered products, pre-payments, credit notes and gift vouchers will be fully honoured.
"The purpose of the examinership is to re-structure Homebase Ireland so as to put the business on a sustainable footing," the spokesman said. "A key element of the examinership process is to protect as many jobs as possible."