E-commerce company almost doubles profit

PRE-TAX profits at a Shannon-based e-commerce firm last year almost doubled to €935,366 despite revenues decreasing.

Returns just made to the Companies’ Office by Digital River Ireland show that pre-tax profits increased by 47% from €492,586 to €935,366.

The accounts show that the US-owned firm recorded the increase in spite of revenues decreasing by 6.5% from €64.7 million to €60.5m in the 12 months to the end of December last.

Last year, the numbers employed by Digital River reduced from 75 to 72.

According to the directors’ report, the decrease in revenues “was primarily attributable to the decrease in Symantec Corporation revenues year on year.

The reduction in Symantec revenues was partially offset by the growth with existing clients, the addition of consumer electronics clients and expanded strategic marketing activities with a large number of clients”.

Symantec Corporation informed Digital River that it elected not to renew its e-commerce agreement with the company and the agreement was terminated on June 30 2010.

Digital River Ireland Ltd — which conducts Digital River’s sales outside the US — only commenced trading in Ireland in 2006.

The unit provides e-commerce site development and hosting, site merchandise, order management, digital and physical product fulfilment.

The profits include a non-cash depreciation cost of €1.1m The figures show that all of the company’s €64.7m turnover was generated in EU.

The figures that the company’s operating profit increased four fold to €4.1m on the €964,261 recorded in 2009.

However, interest payments of €3.8m last year compared to previous interest payments of €418,362, reduced the company’s profits to €935,366.

At the end of December last, the company had accumulated profits of €3.3m. The company’s staff costs dropped marginally from €4.06m to €3.4m.

The figures show that 33 are engaged in customer service; 18 in finance and executive; 11 in IT and 10 in business operations.

The filings show that the company’s operating expenses last year increased by 33% from €47.7m to €63.7m.