Winter salt sales add zest to firm’s margins

INCREASED sale of salt due to the bad weather helped the Irish International Trading Corporation (IITC) slip back into the black last year.

The Cork-based hardware supplier reported pre-tax profits of €1.5 million in the year to the end of December 2010 following losses of €2.5m in 2009.

The company said however that the lack of credit available to business in Ireland is a concern.

“As experienced in 2010 the risk of increased bad debts due to companies and businesses closing as result of working capital issues continues to be a possibility,” the latest accounts read.

Turnover increased from €37m in 2010 to €35.9m in 2009, an increase of 3%.

“Following the severe contraction in sales experienced during 2009, sales in 2010 stabilised and recorded modest growth.

“Demand remained weak across all departments with the exception of salt which recorded good growth due primarily to the extreme weather conditions experienced at the beginning and end of 2010,” the accounts said.

Gross margins have improved to 21.3% from 18.4% in 2009, due to the mix of products sold. Higher margin products performed better in 2010 compared to the prior year.

Overhead costs were cut by 2% to €5.4m. The company said that while significant savings were achieved across the majority of overheads these were negated by bad debts of €125,000 which were written off and a loss on the sale of AIB shares of €56,000.

The company’s pension scheme recorded a gain of €495,000 in 2010 and the deficit has now been reduced to €306,000.

The accounts include an exceptional charge of €383,000 relating to its trade in the dealing and development of land.

The directors said they are satisfied with the results achieved during “very difficult trading conditions”.

The principal activity of the group is the sale of steel, wire, hardware, plumbing materials and salt.

The group trades from Tramore Road and Tivoli in Cork and in Ballymount in Dublin.

In 2008 it started to trade in the dealing and development of land.

The directors propose a dividend of €420,000 for the year ended 31 December 2010.

Staff costs fell from €3.7m to €3.5m last year as the number of staff employed fell from 87 to 86. Directors remuneration was €539,176 last year.