Software giant’s pre-tax profits drop 11% despite revenues above €1.49bn

PRE-TAX profits at the main Irish unit of US software giant, Adobe last year dropped by 11% to $531.1m (€395.2m) in spite of revenues climbing to over $2 billion (€1.49bn).

The filings by Adobe Software Trading Company Ltd and subsidiaries also confirm a dividend pay-out of $700m (€521m) last year — $100m (€74.5m) in 2009.

The company — with an address at Citywest, Dublin — is the intermediary holding company for Adobe’s subsidiaries based in Europe, Africa and the Asia-Pacific regions.

Revenues last year climbed 25% from $1.63bn to $2bn as the company’s pre-tax profits slipped 11% from $599.5m to $531.1m.

The revenues generated by Adobe’s Irish unit represent 54% of the company’s worldwide revenues in the year to the end of December 3, 2010.

The company paid taxes totalling $46m compared to $39.2m in tax in 2009. After-tax profit last year was $485.1m.

The $700 million payout left $1.77 billion in accumulated profits at the Irish-based holding company.

The directors state that the 25% increase in revenues last year was “as a result of improvements in the international economic environment, new product releases and new business unit revenue streams”.

The company’s operating margins reduced to 25% from 35% in 2009.

The directors state that there “are satisfied with the results of the group”.

Operating profit last year was $513m compared to $565m in 2009 — a drop of 9%.

The cost of sales increased by 179% from $111m to $310m, while the company’s administrative expenses more than doubled from $128.9m to $276.8m.

The company employed 1,542 at year end with staff costs of $341.4m, up29%.

The company incurred non-cash costs of depreciation and amortisation totalling $218.4m.

The Irish business has investments in 30 subsidiaries in locations as diverse Singapore, Canada, Australia, China, South Korea, Japan, Turkey, Brazil, South Africa and 10 EU states.

Its Irish subsidiary, Adobe Systems Software Ireland Ltd, at Citywest is engaged in sales order fulfillment.

Adobe was established in 1982 and today Adobe Reader software is distributed in 34 languages worldwide, while one billion Flash devices have been shipped globally.

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