Pre-tax profits at chemical firm drop by 7% to €1.3m

Pre-tax profits at a Shannon-based chemical firm last year decreased by 7% to €1.3 million.

Accounts just filed by Chemifloc show that to the end of Dec 2011, the company incurred the drop in pre-tax profits after the firm’s gross profit declined from €4.8m to €4.4m.

The accounts show the company had accumulated profits of €9.8m at the end of Dec 2011.

In an interview yesterday, company director Hilary Lawless said he was happy with how the company performed last year.

He said: “The market place is very competitive, but we have become more efficient.”

Mr Lawless said the company was hoping to increase revenues this year.

However, he said that rising transportation costs could affect business, stating that the company’s annual transport bill is substantial at about €500,000.

The principal activity of the firm is the manufacture of water treatment chemicals with local authorities across the country accounting for a sizeable proportion of the firm’s customers.

According to the directors’ report “both the level of business and the year-end financial position were satisfactory, given the current economic climate, and the directors expect the present level of activity to be sustained for the foreseeable future”.

The profits recorded last year take account of depreciation costs of €520,536.

The company’s cash decreased from €4.2m to €3.3m. Shareholder funds at the end of Dec last year totalled €10.6m.

Mr Lawless and his business partner started the company from scratch in 1981, having been formerly employed by state agency Forbairt.

Forty people are employed by the firm and Mr Lawless said it gives him a lot of satisfaction to be providing local people with “reliable, steady employment and it is very, very important in the current environment”.

With the establishment of Irish Water, Mr Lawless said that he expects a great shake up in the industry.

He said: “It may take some time for things to pan out.”

Mr Lawless said that prices in the industry “are very depressed at the moment”.

He said: “We have a steady business. Nothing spectacular.”

The directors paid a dividend last year of €32,000.”

A note attached to the accounts states: “During the year, the company purchased land adjoining the factory premises, at arm’s length for €1.9m. The balance of €1.8m on the directors’ current accounts represent the amounts still owing to the directors at December 2011.”