Home Retail Group to close HomeStore&More trial in February 2012

In an Interim Trading Statement released this morning, Home Retail Group advised that it would be closing its UK homewares trial format, HomeStore&More, at the end of February 2012.

HomeStore&More was an Irish retail business in which Home Retail Group acquired a 33% stake in 2007, at a cost of £6.8m. The investment was used to expand the business throughout Ireland, where there are currently 10 stores: Blanchardstown, Carlow, Cork, Drogheda, Fonthill, Limerick, Sligo, Swords, Tallaght and Tralee.

Home Retail Group was trialling a wholly-owned HomeStore&More format on the UK mainland as an out-of-town destination store for all its homeware categories. The first store opened in Aylesbury in October 2007, followed by openings in Cambridge, Harlow and Abingdon.

All four stores were around 20,000 square feet in size, incorporating product departments such as cookshop, electricals, tableware, bedroom linens, bathroom and curtains. They offer keenly priced everyday items up to designer names for the home, including Cath Kidson, Le Creuset and Christy.

The statement explained the costs associated with the closure:

“The closure costs, which will be taken below benchmark profit before tax in the current financial year, will be approximately £10m. The cash component of this cost will be approximately £7m, the majority of which relates to the existing store lease commitments for which the outflows will occur over the next few years until the expiry of the last remaining lease.”

It is unclear if or how the termination of the trial will impact upon the Irish operation, and Home Retail Group has made no further announcements regarding staff at the four stores affected by the decision.

Source : Insight Research Team