Homebase boss pledges profit rebound by next year after botched takeover

The boss of loss-making Homebase, which was sold for £1 after a botched takeover, on Wednesday said the DIY chain will be back in the black next year.

Chief executive Damian McGloughlin, who is spearheading a turnaround of the retailer, said the business is expected to break even this year and return to profitability in 2020. “We’re aware we’ve got lots to do but we’re very optimistic about the future.”

Homebase was bought by restructuring specialist Hilco, former owner of music chain HMV, from Australian firm Wesfarmers in May, after a disastrous two-year ownership.

The firm today said its losses narrowed from £172 million to £33 million for six months to December 30. This was mostly down to job cuts at its HQ, 47 store closures, negotiating lower rents and closing two of its six distribution centres.

Revenues were down slightly from £515.6 million to £497.8 million compared with the same period last year.

The chain has also borrowed £95 million from Wells Fargo and Hilco injected £25 million. It has 186 shops and no plans to cut more jobs. McGloughlin said: “We want to simplify the business and make it more efficient but we have the right structure and team.”

Wesfarmers admitted to several “self-induced” mistakes after it dropped popular kitchen and bathroom products or didn’t have enough stock. Homebase is now bringing those ranges back.