B&M European Value Retail wrote down the value of its German unit Jawoll and put it under review.
The latest move by the company came as the unit turned into a loss-maker earlier this week.
Jawoll, which was acquired by the B&M in 2014, recorded a 3.2 per cent rise in sales but fell to a loss of £12.2 million, in the first half of its financial year.
Shares in B&M were moved down earlier week over seven per cent, paring gains for 2019 to 24.3 per cent.
The performance in Germany overshadowed a firm first half from its main British business.
The Indian-origin Simon Arora-led company has 98 stores in Germany, primarily operating under the Jawoll brand.
B&M trades from 645 stores in the UK operating under the B&M brand and 290 stores under the Heron Foods and B&M Express brands.
B&M’s overall pretax profit moved down by 70.5 per cent to £32.2m, which included an impairment charge of £59.5m relating to its German unit, the company said in its financial report for its first half ended in September.
Arora, B&M’s chief executive, blamed the company’s German team, which had ordered higher stock while trading at the Jawoll chain remained weak.
About 50 per cent of Jawoll’s £12m losses were due to an increase in warehouse and transport costs.
The group’s latest setback is a rare negative development for the Liverpool-based B&M.
Arora, 49, started his business in 1995 supplying low price products from Asia to retailers before acquiring B&M in 2004, which is valued at £3.5 billion.
B&M makes 86 per cent of its sales from its British stores, where sales rose by 13.8 per cent.
The Asian-origin top executive of the business said that he was moving ahead with plans to raise the number of stores from 645 to 950.
Reena Barai, chair of the PB Conference, on the podium with Sadik Al-Hasan, Harry McQuillan, Shilpa Shah and Nick Kaye on stage
Yasmin Karsan, Pritee Panchmatia and Fin McCaul
Baba Akomolafe, Rachna Chhatralia, Patricia Tigenoah-Ojo and Raj Matharu
Shailesh Solanki 
Reena Barai 
Janet Morrison
David Webb 
