Specialist food supply company cuts losses

HORGANS Delicatessen Supplies, the Cork-based speciality and chilled foods distributors, reduced its losses significantly last year.

The company saw pre-tax losses fall to €128,378 in the year to January 3, 2010, from €729,638 in the previous year.

The company is forecasting a trading profit of €466,695 for 2010. This is before charging interest of €111,879 and depreciation of €369,879. Total costs for 2010 are targeted to fall by 9.5% to a total of €7,500,000 approximately, according to accounts just filed.

Sales last year were down slightly from €33m to €28m.

The long-term lenders to the company granted a capital repayment moratorium of one year in May 2009. Capital repayments will re-commence in May this year and are provided for in the amount of €101,718. The forecast balance as at end 2010 is €844,964.

“Having kept in touch with the company’s bankers to appraise them of the company’s ongoing performance, the directors are confident of their continued support,” the accounts read.

The directors are also confident that the measures that have been taken, and are still being taken, will ensure the company will be in a position to benefit the inevitable, even if delayed, upswing in the economy and will return to profitability in the following year, the accounts said.

“The policy of continually sourcing new and exciting products will continue as this is seen as a vital component of the recovery strategy,” they said.

The company said that while the Irish economy continued to decline last year measures implemented by the company in late 2008 and early 2009 resulted in a “much better performance”.

The firm said it has reduced its total cost by €1,655,000.

Employee numbers were reduced to an average of 91 for the year from 109 in 2008. Staff costs in the year were €3.4m down from €4.4m in the previous year.

The accounts said an agreement was reached with employees for the elimination of all bonuses and a salary reduction of 10% from May 2009 and this agreement stays in place until at least December 2010.

The company operates a state-of-the-art warehouse at Knocknamuck in Mitchelstown and also has depots in Dublin and Tuam.

The directors do not recommend the payment of a dividend.