Building contractor still profitable

A DIRECTOR of one of the largest building contracting firms in the mid-west yesterday said he is pleased the company has remained profitable throughout the recession.

Alan McCarthy of Brian McCarthy Contractors Ltd was commenting on accounts just filed that show the firm recorded pre-tax profits of €130,344 after revenues fell by 63%, from €40.1 million to €14.6m, in the 12 months to the end of December last.

He said: “We are four years into the recession and we have remained profitable. We are very pleased with that and we have had a lot more success than our competitors. That is testament to how the company has managed the crisis and the quality of our staff here.”

He ascribed the drop in revenues last year to “the company prudently tendering for contracts whereas other companies are buying work at a loss”.

Mr McCarthy said: “This is rampant. It has social consequence and it is usually the sub-contractor which loses out.”

He said that in Ireland, “it is a very, very difficult trading environment and the construction sector is near collapse”, adding that the company “has to go further to get work”.

“We still have a foothold in Ireland, but we have offices in London and Poland and the decision to seek business in those areas is now paying dividends.”

Mr McCarthy said the company has seven contracts — three with the British government in London and two contracts in Poland.

“In Ireland, we are building an Aldi in Fermoy; a Garda station in Castleisland and work at the University of Limerick and Dublin Airport,” he said.

The firm — in business 30 years — recorded an 11% drop in pre-tax profits last year, from €146,886 to €130,344; operating profits fell 78%, from €380,890 to €82,857; and net interest income of €47,487 increased profits to €118,630.

The firm had accumulated profits of €11.7m at the end of last year. Its shareholder funds of €12.3m included €2.4m in cash.

The figures show that the numbers employed by the company last year dropped from 108 to 58, with 26 in construction; 23 in administration and nine in management.

Staff costs last year fell from €3.4m to €1.5m while directors’ remuneration for the seven directors decreased from €857,486 to €606,004.

The pre-tax profit last year takes account of depreciation costs of €162,202. The company had bank borrowings last year of €7.3m.