Pre-tax losses of €38m at drink group

Exceptional costs totalling €34.7m contributed to pre-tax losses of €38m at drink group, M&J Gleeson (Investments) Ltd last year.

Alcoholic drinks firm C&C Group purchased M&J Gleeson for €12.4m in 2012 and new accounts show the Co Tipperary group recorded the losses in the eight months to the end of February 28 last after enjoying a pre-tax profit of €2.39m in 2012

The group’s brands include Tipperary Mineral Water, Finches soft drinks and Estrella beers.

The accounts show the group’s revenues last year declined by 37.5% from €246.97m to €159.76m. However, the main factor behind the steep drop in revenues was last year’s accounting period being only eight months and the prior year being 12 months.

The hefty losses arose from a write-down of €29.2m in fixed assets; a €4.5m write-down in goodwill; a €3.9m write down in stock, and a bad debt provision of €2.9m.

The accounts show the group recorded an operating loss of €3.9m that followed an operating profit of €4.72m in 2012. Numbers employed last year decreased from 655 to 625, with staff costs reducing from €20m to €12m.

The group’s cost of sales last year totalled €136m while administrative costs amounted to €18.39m with distribution costs totalling €8.6m.

According to the directors’ report “the group will continue to seek growth through the development of new and existing products and markets as it integrates with the Irish business of C&C group plc post period end”.

At the end of February last, the group had accumulated profits of €4.22m with shareholder funds standing at €4.86m.

The group’s losses take account of non-cash depreciation costs of €2.93m.

Directors emoluments last year reduced from €473,869 to €387,394.

Established by the Gleeson family in the late 1960s in Borrisoleigh, Co Tipperary, Gleeson was a manufacturer of soft drinks and a bottler of a well-known stout brand.

The company was acquired by brothers Patrick and Nicholas Cooney in June 1974.