Pre-tax profits at duty free operator halve

Pre-tax profits at Shannon-based duty free operator, Aer Rianta International almost halved last year to €18.9m.

According to new accounts filed by the Dublin Airport Authority (DAA) subsidiary, the firm recorded the drop in profits despite revenues increasing by 4% from €59.7m to €62.1m in the 12 months to the end of December last.

The directors’ report said “the trading performance of the company in 2012 has been satisfactory”.

The directors state that the decrease in profit “arose from a reduction in income from financial assets and investments due to a reduction in dividends received from subsidiaries and associated undertakings, including associated undertakings disposed of in 2011”.

The firm’s revenues of €62.1m and gross profit of €11.1m “have improved due to improved trading conditions”.

Last year, the pay-off of €867,000 received by ARI’s former ceo, Eamon Foley in 2011, attracted attention contributing to emoluments for directors totalling €1.85m in 2011.

Mr Foley’s generous exit package included a lump sum of €437,000 and a payment of €68,000 annually for 6.3 years to bridge the gap to retirement.

Last year, aggregate emoluments, including pension payments for four directors, that includes new ceo, Jack McGowan and ARI’s head of investment and corporate resources, Michael Upton, decreased sharply to €511,000.

DAA CEO since Jan 2013, Kevin Toland serves as ARI board chairman and is joined on the board by DAA chief financial officer Ray Gray.

The business created the first duty free shop at Shannon in 1947 and revenues generated in the Commonwealth of Independent States (CIS), with Russia, its largest member, accounted for 94%, or €58m, of ARI’s revenues last year.

Revenues in the US and Europe reduced sharply while income at ARI’s Middle East increased by 12% from €3.1m to €3.54m.

Operating profit last year increased by 6.7% from €4.49m to €4.8m.

However, a sharp decrease in income from financial assets from €26.9m to €14m contributed to the 47% decrease in pre-tax profit going from €35.57m to €18.9m.

The profit last year takes account of non-cash depreciation costs of €293,000.

The firm’s accumulated profits last year totalled €207.5m.

The firm’s cash last year almost doubled from €4.7m to €8.1m.

The numbers directly employed by ARI last year reduced from 63 to 52, with staff costs reducing by 28% from €4.3m to €3.1m.