Homebase  |  Press release

Homebase House & Garden Centre Ltd, ("Homebase Ireland") a wholly-owned subsidiary of Home Retail Group plc, has filed a petition with the High Court in Dublin seeking the appointment of an Examiner. The Court has appointed Kieran Wallace of KPMG as Interim Examiner, providing protection for Homebase Ireland, during the period of examinership.

Homebase Ireland has 15 stores in the Republic of Ireland, employing 558 colleagues.  Of these 114 are full time and 444 are part time.

All Homebase Ireland stores will trade as normal during the examinership. All customers' ordered products, pre-payments, credit notes and gift vouchers will be fully honoured. All colleagues will continue to be paid.

The purpose of the examinership is to re-structure Homebase Ireland so as to put the business on a sustainable footing. A key element of the examinership process is to protect as many jobs as possible.

As a result of the economic recession in Ireland and the associated fall in disposable income, reduction in new house builds and lower consumer spending on repair, maintenance and improvement products, Homebase Ireland has experienced a 31% reduction in sales since 2009 and it has been unprofitable for each of the past five years, despite significant remedial action being taken by management.  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.  This is a situation that can no longer be sustained.

Homebase Ireland believes that to have a reasonable prospect of survival, consideration will need to be given to closing non-viable stores. Based upon both the current trading performance and forecast projections, it is proposed that three of the 15 stores will close. These stores are located in Fonthill, Carlow and Castlebar. In total, they employ 17 full time and 79 part time colleagues. In addition, the future viability of the remaining 12 stores will depend on a number of factors including securing the agreement of individual landlords of improved lease terms.

These proposals are subject to the recommendations of the Examiner.

Robert Burke, Chairman, Homebase Ireland said: "The significant deterioration in consumer spending over the last five years coupled with high rents at each of our stores has made restructuring an imperative in order to re-establish a sustainable business, to secure the future of as many stores as possible and to protect as many jobs as possible. Today's appointment represents an important step in this process.

Customers can be reassured that the business will trade as normal during the examinership and all ordered products, pre-payments, credit notes and vouchers will be fully honoured." 

Ends.

For Reference

Ireland:
Anne-Marie Curran,
Drury.
Tel +35312605000 / 353872864079

UK:
Chris Wermann,
Director of Corporate Affairs,
Home Retail Group.
Tel +441908296334

Notes to Editors:

In 1999, Homebase UK acquired the Hampden Group plc which had the franchise for three Homebase stores in the Republic of Ireland. Homebase Ireland expanded its operations across the Republic between 2000 and 2009 through the development and opening of new stores.

Homebase Ireland stores are located in Limerick, Sligo, Waterford, Drogheda, Longford, Killarney, Letterkenny, Castlebar, Carlow, Portlaoise, Navan, with four in Dublin (Naas Road, Fonthill, Nutgrove and Santry).

Homebase Ireland is part of Home Retail Group plc, the leading home and general merchandise retailer.

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