Belfast Telegraph

Dunnes Stores, Bangor: company report and analysis

By John Simpson

Dunnes Stores (Bangor) consolidates the trading figures for all Dunnes Stores in Northern Ireland as well as a smaller number of outlets in England. The group describes its main business as the retailing of textiles, grocery and houseware goods.

Annual turnover by this group of companies has been falling in recent years. It peaked at £231m in the year to January 2005. Since then it has fallen gradually, excepting in 2009-10, but in the most recent year was nearly 40% lower than at that peak.

Operating profits have proved to be more variable. From a peak of £39m in 2004-05, in the last seven years they have fallen sharply. There was a large fall between 2011 and 2012, with a partial recovery in 2013.

The ratio of operating profits to turnover has been variable, falling to just under 10% in the most recent year. Three years ago, this ratio was lower than normal at just over 7%.

Pre-tax profits have usually been higher than operating profits because the group has had large credit balances earning interest. This position changed in 2011-12 when the parent company transferred creditor balances out of this subsidiary. The balance sheet records that credit balances, due elsewhere in the company structure, were over £180m in January 2010 and were transferred out in 2010-11.

Contrastingly, in January 2011, a debtor balance of £154m was owing from within the group and this balance rose in January 2013 before falling to £118m in January 2014. These changes were reflected in large changes in the levels of working capital available to this company.

Internal business between Dunnes Stores (Bangor) and the parent company, Dunnes Stores (RoI), was reflected in a report that during the most recent year purchases valued at over £60m were made for resale by the parent company and charged to the Northern Ireland registered company at cost.

Employment in 2013-14 averaged 1,724 people. This was a fall of 11% on the previous year and compares with the 3,555 people employed during the peak sales year in 2004-05.

Post-tax profits in 2013-14 were £10.3m. Of this £0.5m was paid as a dividend to the parent company as shareholder, leaving £9.8m to be added to the value of shareholders' funds.

The company operates a defined benefit pension scheme for some employees. The pension scheme assets have risen in value to just over £13m. In the last two years, the pension scheme has moved from an actuarial deficit to recording a surplus in January 2014.

Belfast Telegraph