Fitzwilton cuts losses by €37m

INDUSTRIAL holding company Fitzwilton, owned by Tony O'Reilly and his brother-in-law Peter Gouladris, posted a €37 million fall in losses last year.

The company, which was taken private by Dr O'Reilly in 1998, said pre-tax losses were €8.8 million in 2003, down from €46.4 million in 2002. In that year the bulk of its losses were due to the sale of its stake in the Safeway retail group in Northern Ireland.

According to accounts filed at the Company's Registration Office, operating losses in 2003 were €1.8m, down from €6.7m in 2002, an indication that the core Fitzwilton business is seeing an improvement in trading.

Turnover for the year fell from €144 million to €35.2m, though the decrease was due to the sale of the Safeway stores.

Fitzwilton is a holding company for a number of business including the signage maker, Rennicks. In the account, the director said they are confident that this business will have high sales and profits this year. "Rennicks continues to develop its relationship with its principal supplier, Nippon Carbide Industries of Japan, and discussions are taking place on the launch of new products into the United Kingdom," the company said

Its British business, Wood and Wood, had a "reasonable trading performance" in difficult economic conditions, but was boosted by the recruitment of two top designers.

"This team's focus is on city centre identity projects and, during the year, several design commissions were awarded and it is anticipated that these will transfer into manufacturing projects for Wood and Wood during 2004." Fitzwilton also owns 36% of financial services firm Portfolio Design Group. It said that in weak financial markets in 2003 the company had a good year.

The number of people employed by Fitzwilton fell by 89, with the drop due to the fact that it does not own Safeway. The decrease resulted in a €3.2 million fall in its annual pay bill.

Salaries and other fees to the company's directors fell from €1.3 million to €749,000.

The company's debt fell once again from €120m to €112m, though its cash balances decreased compared to 2002.

Dr O'Reilly and Mr Goulandris' investment vehicle, the British Virgin Islands-registered Stoneworth, paid €170m to take the company private in 1998. This worked out at 63 cent for every Fitzwilton share and €1.27 in cash for every preference share.

The company is majority owned by the pair, though Dr O'Reilly's business associate, Lew Glucksman, also has a stake in the company. Fitzwilton did not pay a dividend to its owner given the scale of the losses incurred.