Harvey Norman, the listed Australian electronics-to-furniture and homeware retailer, boosted sales at its 13 Irish stores by more than 10 per cent to €170 million in the 12 months to the end of June.
The spike illustrates the speed of the recent acceleration in Ireland’s retail economy, as well as the fruits of an investment programme by the group in its Irish estate during the recession.
Blaine Callard, chief executive of the retailer's Irish operations, said it is planning further expansion here after confirming its intention to open a 14th store in west Dublin. It has bought an abandoned retail park on Airton Road in Tallaght and is investing €6 million to convert it into a large store with a Costa Coffee outlet.
Harvey Norman may eventually open another “five or six” new Irish stores, said Mr Callard, and is actively scouting the property market for further acquisitions. It may also consider developing its own properties. Its existing store network comprises all leaseholds.
The group has been searching for more than a year for a site for a new store in Galway. Mr Callard said he is also actively looking to bring Harvey Norman to other “regional locations” in Ireland.
Tallaght will be its fifth Dublin opening, with other stores in locations including Waterford, Limerick and Cork.
Although its Irish online performance was not broken out in the listed group’s results, Mr Callard said its online sales are equivalent to a medium-sized store and grew by 38 per cent over the 12 months.
Harvey Norman is also seeking to consolidate its network of seven Irish warehouses on to fewer, larger sites.
The PLC results state that its Irish network recorded a “trading profit” of more than €500,000 in the final quarter, the first time it has recorded an operational return here since entering the Irish market 13 years ago. It made a loss of more than €5 million in 2015.
Harvey Norman racked up well more than €110 million of Irish losses in the years either side of the crash, leading to consternation at its Australian head office and fears locally it could pull out of the Irish market.
Mr Callard was parachuted in to formulate a turnaround plan for its Irish operation in 2010. He ditched its previous bawdy advertising persona and led a revamp of its store network to emphasise a more design-led, experiential retail offering. It also overhauled its range of furniture to reflect more modern tastes.
“I’m very confident revenue is going to continue to grow throughout the year. Many retailers cut back on investment in their stores during the crash, but we did the opposite and are seeing the benefit now,” said Mr Callard.
It is currently refitting the electronics departments of its stores in Carrickmines and Rathfarnham, which will reopen for Christmas.
While Harvey Norman's furniture sales have expanded on rising activity in the property market, he said its market research shows it is now also "just behind" Dixons as the number two player in the electronics market.
Harvey Norman has previously complained about upward-only leases and rent levels in Ireland that were above market rate, Mr Callard said it has since achieved reductions at most of its network: “Only two landlords have yet to come to the party in terms of giving us more reasonable rents.”
He is also responsible for the performance of its two outlets in Northern Ireland, which increased sales in the 12 months to £8.13 million. Mr Callard said he expects them to become profitable this coming financial year.
