SWEDISH RETAILER Ikea has yet to open its doors to its store in Dublin's Ballymun - or even hang them - but already its Irish subsidiary has racked up losses of €1.83 million.
Accounts just filed for Ikea Ireland Ltd show that it incurred administrative costs of just more than €1 million in the year to the end of August 2007. This compared with a similar expense of €510,532 in the previous year.
When a €259,715 interest charge is added, Ikea's Irish business posted a pre-tax loss of €1.26 million last year, compared with €565,392 in 2006.
The parent company fed its Irish baby an extra €4.99 million on August 22nd last year for working capital purposes through the issue of 5,000 ordinary shares. This left Ikea Ireland with shareholder funds of just under €3.2 million.
Ikea employed three administrative staff in Ireland last year, who earned salaries of €331,736 between them and incurred social welfare costs of €34,888.
That's an average salary of €110,578 and must make them among the best-paid administration workers in the country.
Ikea also paid €14,199 to William Fry Solicitors in Dublin last year, roughly half the level of 2006, for company and secretarial services. Fry's partner Owen O'Connell is a director of the Ikea subsidiary.
The accounts state that a potential deferred tax asset of €199,504 has not been recognised "as there is uncertainty regarding the availability of future taxable profits against which tax losses may be utilised".
Ikea took charge of the site in Ballymun in January and recently said the €100 million store, which will stock 9,500 products, was on schedule for completion before this Christmas.
Its opening, however, could be delayed until early 2010 because of delays in completing the M50 upgrade, a condition of its permission from An Bord Pleanála.
With price and value a hot topic among cost-conscious Irish consumers, the flat-pack retailer must be busting to get going here.
It'll have to shift a lot of beds and sofas before making its money back.
