All eyes on PowerHouse loss as Pacific Retail reports

Eric Watson's big British gamble is back in the spotlight today, with Pacific Retail Group announcing its financial result for the March year.

Watson, now London-based, owns 81.3 per cent of PRG, which bought the British electrical-goods chain PowerHouse from its receivers in 2003 for $47 million.

On January 25, PRG told the sharemarket that PowerHouse expected an operating loss for the six months to March 31 of 5 million ($12.8 million).

The chain lost 15.1 million ($38.7 million) in the corresponding previous period.

In January, PRG blamed "tougher UK market conditions, putting pressure on both sales and margins" for PowerHouse's expected failure to break even over the six months.

In the first half of the financial year, profits for PRG as a whole soared from $341,000 to $55.6 million, thanks to the $92 million one-off gain from its August sale of the Noel Leeming and Bond & Bond chains.

Stripping out these gains, the company was $30.5 million into the red, mainly because of PowerHouse.

No revelations are expected today on PRG's sales process for the company's finance group.

Financial market speculation is that the Hanover Group, owned by Watson and Mark Hotchin, is a likely buyer.

Investment bank Macquarie is handling the sale and PRG's stated timetable is for a deal to be done in July or August.