ECONOMY

Start-up costs hurt Fourlis H1 earnings

Fourlis, which owns the Greek franchise of Swedish furnishing group IKEA, said yesterday first-half net profit fell 35.3 percent, due to start-up costs and higher transport expenses arising from a dockworkers’ strike. Fourlis, which is also a wholesaler in Greece and Romania of electrical appliances such as TV sets as well as mobile phones, made a net profit of 14.1 million euros, down from 21.9 million a year earlier. The firm said the cost of some seven million euros for the opening of a third IKEA store in Greece earlier in the year and transportation expenses due to a strike at Greek ports weighed on its results. Earnings per share reached 0.28 euros, compared to 0.34 in the first half of 2007, the company said in a statement to the Athens bourse. Its shares rose 1.59 percent to close at 14.02 euros yesterday, outperforming a 0.37 percent slide in the Athens bourse’s benchmark general index. Fourlis, which has a market capitalization of 689 million euros, opened its third IKEA store in Greece in March. Last year it took the IKEA brand into Cyprus and plans to add another three stores, including one in Bulgaria, in the second half of 2009. Group sales for the first six months of the year rose 30 percent year-on-year to 349.9 million euros. Earnings before interest, tax, depreciation and amortization (EBITDA) – adjusted for start-up costs and the port strike – gained 16.6 percent on an annual basis to 37.29 million euros, the company said.