Virgin arm takes £145m hit

SIR Richard Branson's Virgin retail and entertainment business lost a staggering £145.3m last year, with UK operations losing the lion's share.

The tycoon's UK entertainment business, which owns Virgin Megastores, lost £129m in the year to January 2003.

The losses appear in accounts for Virgin Entertainment Asia, one of Branson's holding companies.

In spite of the name, most of its subsidiaries are in the UK and Ireland. But it does control retail and cinema operations in Hong Kong, China and Japan, with its Japanese cinema business making a profit of £6.3m.

The losses related to a write-down of VOP Holdings, the holding company of Our Price, which was later put into member's voluntary liquidation.

A Virgin spokesman said that the write-down on the Our Price acquisition was the key driver behind the losses, pointing out that Virgin Megastores made an £8.5m operating profit in the year.

Current trading is said to be strong, he added.