Around 1,400 Irish jobs are at risk as Debenhams in Ireland has been placed in examinership.
The UK retailer has eleven stores in Ireland – four stores in Dublin and two in Cork as well as outlets in Galway, Limerick, Tralee, Waterford and Newbridge. It is as yet unclear whether or not any of Debenhams Irish stores will be forced to close.
Debenhams’ Irish operations have been operating at a loss. The UK parent firm has stated it is no longer willing to accept these unsustainable losses and the costs associated with this.
Debenhams in the UK has claimed that the company is willing to invest in a restructured Irish operation, but is demanding that rent and staff costs be cut. Debenhams' rents in Ireland amount to about €25m a year, and staff costs are approximately €36.6m annually. The Irish operation had sales of €166m last year, but has made losses of €22.6m over the past three years.
Debenhams employs just over 1,400 people directly across the company’s Irish stores. About 500 of these are full-time employees, and another 800 work at concessions and make-up counters.
Kieran Wallace of KPMG was appointed interim examiner by the High Court yesterday. The business is now under the protection of the court. In a statement, the company said the examinership will last up to 100 days.
Debenham has reassured consumers that their eleven Irish stores and online retailing will continue to trade as normal. All prepaid goods and services, gift vouchers and credit notes, will be honoured.
John Bebbington, Director of Debenhams Retail (Ireland) Ltd, says the examinership move is an effort to secure future of the company.
“The directors of Debenhams Retail (Ireland) Ltd will work hard to secure the long term future of the business in Ireland, enabling us to continue to serve our customers well, to provide sustainable jobs for our colleagues and to support the Irish economy.
“A key element of the examinership would be to protect as many jobs as possible. We believe this will be in the best long term interests of all our stakeholders. During the examinership process it will be business as usual for all of our stores and online trading.”
Trade union Mandate, which represents many of the staff at Debenhams in Ireland, said it has sought an urgent meeting with the company and its examiner.