Belfast Telegraph

Argos owner in £804m loss after payout for takeover

By Staff Reporter

Argos owner Home Retail Group has reported a full year pre-tax loss of £804m after being hit with an £852m exceptional goodwill impairment charge relating to the Sainsbury's takeover of the high street retailer.

Home Retail Group employs around 500 people in Northern Ireland. Sainsbury's currently has 13 of its own stores here, while there are nearly 20 Argos and nine Homebase stores.

Stripping out the charge, annual profit slumped 28% to £94.7m and sales across the group were down 1% to £5.6bn.

The exceptional impairment charge relates to Argos' prior ownership under Great Universal Stores, which acquired the business in 1998.

The group said: "The recommended offer from Sainsbury's for the purchase of Home Retail Group resulted in an exceptional goodwill impairment charge of £852m."

Earlier this year, supermarket Sainsbury's struck a deal to acquire Argos for £1.4bn and the deal is expected to complete before September. Some Argos operations are expected to be moved into Sainsbury stores as part of the deal.

John Walden, chief executive of Home Retail Group, said: "The group ended the year with a cash balance of £623m, which is significantly stronger than previously anticipated.

"The past year has been a landmark period for the group, during which we have completed the sale of Homebase and recommended to shareholders the offer from J Sainsbury for the acquisition of the remaining group, principally Argos."

The group sold Homebase to Australian retail giant Wesfarmers for £340m in January.

Earlier this month, it emerged that the massive £340m deal to sell Homebase was recorded as taking place in Northern Ireland, where the DIY chain's holding company is based.

Experian confirmed that Homebase was incorporated in Northern Ireland as Hampden Group Ltd in 1976.

As well as operating Homebase in the province, Hampden is an investment holding company for Home Retail Group firms.

Belfast Telegraph