Profits plunge 90% at IITC

IRISH International Trading Corporation (IITC), the Cork-based hardware supplier, saw its profits plunge 90% last year due to a €2.7 million hit from the write down of development land and AIB shares.

The company reported pre-tax profits of €311,482 in the year to the end of 2008 compared with €3.4m in the previous year. Turnover fell from €51.3m to €50.8m.

It said, however, that given the “dramatic downturn” in the economy in 2008, the directors were “satisfied” with turnover.

The company purchased a 7.87-acre greenfield site which didn’t have planning permission but was zoned for development in Naas, Co Kildare, in January last year.

At the time of purchase the company was intending to develop half the land as a site for a warehouse to replace its existing Dublin premises.

It had intended to develop commercial units for resale on the other half of the land.

The company said in the accounts that although it recently obtained planning permission for the development of the warehouse, following some delays with the process, it was “currently reviewing their options” in relation to the development.

According to accounts just filed by IITC it took a €1.1m hit on the writedown of the development land.

Also the accounts include an exceptional charge of €1.2m relating to its “trade in the dealing and development of land”.

“This relates to the second portion of the land acquired during the year. The loss arises due to the writedown of its stock of trading and development land, related to the Naas site, to its estimated net realisable value,” the accounts read.

Overheads at the firm increased from €5.9m in 2007 to €6.2m last year. Included within overheads is an impairment charge of €74,000 against the carrying value of AIB shares held by the group.

“This charge relates to the writedown of the AIB shares held by the group to their year end market value,” the accounts read.

The company has six directors and trades from Tramore Road and Tivoli in Cork and from Ballymount in Dublin.

The directors said they were “pleased with the trading performance of the group in the very difficult trading conditions which prevailed during 2008, particularly in the final quarter of the year”.

Despite employee numbers falling from 92 to 88 staff costs increased to €4.1m in 2008 from €4m in the previous year.