Challenging conditions hit Mars Food sales and profits

Extremely challenging trading conditions at the Irish arm of food giant Mars last year contributed to a slump in sales and profits.

New accounts just filed by Mars Food Ireland Ltd show that the firm recorded a 44% decrease in pre-tax profits last year from €9.7m to €5.4m. This followed revenues at the firm decreasing by 5.6% to €127.7m in the 12 months to the end of last December.

In the accounts, the company’s directors state that “trading conditions in Ireland remain extremely challenging with continued pressure on consumers’ disposable income, impacting sales growth in 2013”.

The report goes on to say: “Consequently, Mars Food Ireland Ltd report a €7.6m decline in sales, a 3.7% decrease in margin and a reduction in profit after tax of €4.3m.”

The firm continues to focus on the four categories in which it operates — food, chocolate, pet care and gum. Its brands include Uncle Ben’s Rice, Snickers and Twix bars along with Wrigley chewing gums and Pedigree and Whiskas pet foods.

“The board recognises the continued market challenges in the sectors within which we operate and is committed to strengthening, further, the relationship we have with our key trading partners,” the company said.

The drop in operating profits was even more acute, at 51%, declining to €4.75m. However, interest receivable and other finance income totalling €690,000 — in contrast to finance costs of €64,000 in 2012 — contributed to the €5.4m pre-tax profit.

The accounts show that the firm’s cost of sales last year dropped from €116m to €114.2m with the firm’s administrative expenses decreasing from €9.58m to €8.74m.

A breakdown of the staff numbers show that 94 were engaged in selling and marketing with 37 in administration. Six directors served during the year and the accounts show that directors’ emoluments increased from €691,000 to €830,000.

The company paid Arthur Cox €171,546 in legal fees.


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