PROPERTY sales and cash injections from directors helped keep DIY retailer Rapid Hardware afloat after it suffered a huge fall in sales and profit margins during its final year in Renshaw Street.
Rapid Group Holdings’ turnover fell 34%, from £12.2m to £8.1m, in the 12 months to January, 2009, according to accounts filed at Companies House last week. The group also reported a pre-tax loss of £3.38m, down from a profit of £57,000 the year before. Directors now hope that Rapid’s recent move to the former George Henry Lee store last summer can return the business to profit. In the accounts, the directors state that Rapid “suffered not only from the general shift to the newly-created Liverpool One, but also from the severest economic climate for over 60 years”.
Trading subsidiary Rapid Hardware’s poor performance caused its auditors, Bootle accountancy firm SB&P, to raise concerns about its ability to continue trading without the support of its parent company.
Rapid Hardware recorded pre-tax losses of £1.46m after sales dropped by more than £4m to £8m in the year to January, 2009.
This contributed to Rapid Group making a pre-tax loss of £3.38m, after including a £2m charge forfeited on a non-refundable deposit for a property purchase that didn’t complete.
The accounts, filed at Companies House nearly five months late, showed shareholders pumped in £1.2m to Rapid Group, of which one-third was repaid during the financial year.
An increase in its overdraft saw Rapid Group’s total loans go up £1.3m to £6.3m, of which £3.2m was due within one year or on demand.
The directors’ report said: “The group has refinanced after the year- end, following disposal of property, and the directors have prepared projections based on maintaining current margins and continuing the levels of growth experienced since relocating the store which indicate that the company will return to profitability in the current financial year.”
Rapid moved into its new home at the former George Henry Lee building in Liverpool city centre last August.
Last June, the group sold properties in Renshaw Street, Bold Street, St Lukes Place and other city centre locations and paid £4.5m for a 250-year lease for its current store.
There was no comment from Rapid Group yesterday.
