Atlantic Home Care, part of the Grafton Group, has filed for examinership in Ireland in an attempt to restructure its business and ensure the 'survival' of the company.
Atlantic is a member of the DIY Division of the Grafton Group. Operating in Ireland, it was acquired as part of the Heiton Group in 2005. The business has been severely impacted by the recession, which has hit Ireland particularly hard and, in particular, by the decline in consumer spending and in the housing sector.
In addition, the company’s ability to reduce operating costs has been inhibited by the retention of “upward only” rent reviews for existing leases.
Atlantic accounts for 2.75% of Grafton Group revenue and has traded at a loss since 2007. The turnover of Atlantic has fallen by 44% from €100 million to €56 million during that period, and it continues to trade at a loss in the current year.
Grafton Group's DIY Division as a whole has traded successfully and profitably in a demanding retail environment throughout this period, but its performance has been held back by the Atlantic losses. These losses are no longer sustainable and a restructuring of Atlantic via the examinership is intended to bring these losses to an end while maximising the potential for the business to survive.
An Independent Accountants’ Report from KPMG on Atlantic has concluded that it is possible for a sustainable and profitable business to emerge from the examinership process, after a restructuring of the company.
Atlantic has no bank debt and is not part of the Group’s financing arrangements and, accordingly, this development will have no impact on financing and trading arrangements in the wider Grafton Group and its other subsidiary companies in Ireland, the UK and Belgium.