Morgan Fuels returns to profit

Dundalk-based fuel group Morgan Fuels climbed back to profitability in the six months to the end of March, despite a significant drop in sales.

Accounts filed to the Company’s Office show the firm’s turnover declined markedly, even allowing for the differing accounting periods covered by the latest set of accounts and those filed in September 2013, which encompassed an 18-month period.

The six months to the end of March saw the company record turnover of €71.4m, compared to €244.4m for the previous 18-month period.

The company said sales declined in line with expectations and attributed the decrease to strategic decisions taken by the directors in respect of bulk deliveries business which contributed €11.9m to revenues to the end of March, compared to the €54.8m recorded in the previous year and a half.

The company’s fuel card sales business also declined in the six-month period to just under €60m but remained broadly in line with the previous period when sales from that business segment amounted to €188m.

Despite decreasing revenues, Morgan Fuels Ireland Ltd turned a profit of more than €325,000 in the six months to the end of March, compared to the €385,760 loss in the previous period.

An exceptional item arising from a €2.99m revaluation of investment property contributed to the deficit recorded at the end of September last year.

Falling sales costs, which declined broadly in line with decreased revenues, also helped the company back to profit this year.

The directors’ report lists the “highly competitive” fuel card market in Ireland, the UK and Europe and tight margins among the group’s principal risks and uncertainties.

Operating profit stood at €577.9m in the period covered by the latest accounts. The company recorded an operating profit of €3.63m in the previous 18-month period, helped significantly by €2.4m debt forgiveness.

The number of employees at the group owned by Hugh Morgan fell to 40 from 53 with staff costs of €496,800 recorded to the end of March, compared to more than €2m for the previous 18-month period.

Directors’ remuneration for the six months to the end of March was €30,440.

The company had net assets in excess of €1.05m at the end of the accounting period, an increase from the €739,700 recorded in September last.