Profits at Harvey Norman's Irish arm fall by 23pc to €10m
The directors said revenues increased by 0.2pc last year but they point out that when compared with pre-pandemic sales of €236m in the 2019 financial year, there has been significant growth of €189m, or 79.96pc, over that time.
'During this period the brand has gone from strength to strength and has significantly grown market share in all its categories,' the directors said.
The 2024 financial year is the seventh straight year of profitability for the Irish business.
'The supply chain and transportation costs which hampered the business in the previous year have decreased and returned to acceptable levels, and improvements in margins in the furniture business has started,' according to the directors.
They expect these improvements to continue in the next 12 months.
At the end of last June, the group operated 16 stores in the Republic and two in the North. Profits were hit by a non-cash €1.73m writedown on its investment property portfolio and interest charges of €1.32m.
The group recorded post-tax profits of €8.19m after incurring a corporation tax charge of €1.9m.
The directors said the group recognises the economic headwinds that were present during FY24 will persist into FY25, but inflation has started to fall 'and we expect that to continue throughout the next 12 months'.
Administrative expenses for last year were inclusive of intercompany brand licensing fees payable under a revised global transfer policy adopted this year.
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Directors state the profitability of the Irish group was reduced by €6.87m last year due to the brand licence fees payable under this policy.
Operating expenses increased last year with marketing, warehousing and distribution increasing year on year.
The profit last year takes account of non-cash depreciation costs of €5.49m, while lease costs decreased from €16.3m to €16.05m.
Staff costs increased from €56.5m to €58m as staff numbers dipped from 1,438 to 1,433. Directors' pay including pension payments of €17,500 totalled €677,759.
The directors state that 'the group also settled matters relating to an uncertain tax position arising from an Irish Revenue tax review for Harvey Norman Tallaght Ltd'.
In 2023, the group valued the uncertain tax provision at €218,081 and a note states that the matter giving rise to this uncertain provision was settled subsequent to year end, and the provision has been reversed.
In calculating the group's overall corporation tax liability, the accounts included a tax settlement adjustment of €187,277.
At the end of June 2024, the group had shareholder funds of €71.89m. Cash funds increased from €8.43m to €13m.
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