Pre-tax losses increased last year more than nine fold to €2.45m at the Irish arm of GAP ahead of the US clothing retailer's decision to shut down its company operated "bricks and mortar" Irish stores this year.
According to new accounts lodged by Gap Stores (Ireland) Ltd, the firm recorded the sharp increase in pre-tax losses after revenues slumped by 46% or €5.85m from €12.69m to €6.84m in the 12 months to the end of January this year.
The firm's pre-tax loss takes account of non-cash impairment costs of €436,116 during the Covid-19 hit year.
On June 30 last, GAP announced that despite discussions with potential partners, "the Republic of Ireland market dynamics were too challenging".
The decision was taken to shut down company operated stores from the end of August to the end of September this year.
The directors stated that since the end of the year all five trading locations have been closed. Four have been surrendered to the landlord and discussions are continuing for the surrender of the remaining site.
The directors stated that the €5.85m revenue decrease last year "is due to the global pandemic of Covid-19 impacting our retail performance, through enforced store closures and customer shopping patterns".
GAP is to become a digital first business here and will be partnering with Next as a joint venture online business to drive growth.
"Opportunities will continue to be sought to improve profitability and market share in the Irish apparel market," the company's directors said.
Numbers employed by the business at the end of January last totalled 117 and on the closure of the company operated stores, the directors said that the company "would thoughtfully move through the consultation process and provide support and transition assistance for employees as the stores wind down".
Staff costs last year reduced by 30.5% from €2.06m to €1.43m. The company last year received €129,891 in Government Covid-19 wage support.
At the end of January last, the company had a deficit of €1.5m in its shareholder funds. The company's cash funds reduced from €1.24m to €906,983.
The directors stated that GAP Inc had $2.06 billion in cash at the end of January last and would continue to support its Irish entity to enable the company to fund all costs associated with the winding down of the business including all store closure costs and any remaining third party relationships.
The Irish company's immediate parent, GAP (UK Holdings) Ltd last year recorded pre-tax losses of $124.89m as revenues decreased by 38% or $136.6m from $361.34m to $224.68m.
