The High Court has extended time for a report from the examiner appointed to prepare a survival scheme for the company operating Debenhams eleven stores here.
Mr Justice Brian McGovern agreed on Wednesday to extend time for examiner Kieran Wallace to finalise his report and also continued court protection to July 20th. There was no objection to the extension application from lawyers for affected parties.
Debenhams Retail (Ireland) Ltd (DRIL) directly employs 1,400 staff while 500 concession staff and 300 cosmetic staff also work in the company’s stores.
It sought court protection in May arising from consistent losses sustained since the recession in 2007 and after withdrawal of support of its UK parent company, Debenhams Retail plc.
Mr Wallace, of KPMG, was appointed examiner after the court was told an independent expert believed the company had a reasonable prospect of survival if certain conditions were met, including securing court protection and approval of a survival scheme with the company’s creditors.
The court has heard the scheme will involve reducing rent costs, which the company says are well above market rates, plus staff costs.
DRIL has incurred losses of €22.6 million in the last three years and, while revenues increased in 2015 and 2014, continues to be loss making this year. The stores continue to operate as normal while the survival scheme is being prepared.
Dooroy Ltd, landlords of DRIL’s stores in Henry Street, Dublin and Patrick Street, Cork, previously told the court it believed the withdrawl of support by DRIL’s parent was the cause of DRIL’s “collapse” and the parent was the entity “calling the shots” in negotiations. Dooroy also disputed suggestions by DRIL that negotiations concerning rents had been unsuccessful.
DRIL operates four stores in Dublin, two in Cork, and others in Galway, Limerick, Newbridge, Tralee and Waterford. It says it owes its parent €46 million and that is unsustainable. The only alternative to examinership was liquidation with an estimated deficit of €264 million, it says.
