Irish toy giant Smyths Toys has provided its mainland European business with a capital injection of €175m.
The move by the Galway headquartered family owned firm follows its European arm being the group's most profitable unit in 2020.
Recently filed accounts for the business’s German, Austrian and Swiss entity, Smyths Toys EU HQ Unlimited Co show that it recorded pre-tax profits of €10.97m in 2020.
This followed revenues increasing by 4% to €475.35m for that year.
The capital injection follows recent confirmation that Smyths Toys enjoyed its busiest year to date in the pandemic hit 2020 where group revenues hit a record €1.465bn.
The group’s mainland European business accounted for 42% of the group’s pre-tax profits of €26m for 2020.
In its store network across Germany, Austria and Switzerland, Smyths Toys operates 114 stores with the bulk of those at 88 located in Germany.
The group also operates 113 stores in England, Scotland, Wales and Northern Ireland, along with 21 here.
Across its network at the end of 2020, the four Smyths firms employed almost 6,000 staff that included 2,288 in its mainland European unit.
The capital injection of €175m now provides Smyths Toys with the necessary financial firepower to continue its expansion in mainland Europe.
At the end of December 2020, Smyths Toys EU HQ Unlimited Co had only €1m in authorised capital and the move now increases that to €176m.
The firm had a deficit of €7.2m in its shareholder funds at the end of 2020.
Revenues at the European business continued to grow in 2020 despite the pandemic impact with revenues increasing by €17.98m to €475.35m.
The capital injection also follows company directors confirming that Smyths Toys outlets in Austria and Switzerland were "performing strongly" after their re-opening in 2021.
The business’s cash funds increased from €61m to €63.5m in 2020.
The capital injection comes almost four years after Smyths Toys in April 2018 moved to purchase the Toys R Us store network in Germany, Austria and Switzerland that facilitated the toy retailer’s European expansion.
The European business has enjoyed rapid growth since the purchase with revenues of €475.35m in 2020 - a 40% increase on the €339.67m in revenues in Smyths Toys first 13 months in business following the purchase.
