Software firm sees profits slump 46%

Pre-tax profits at the Irish arm of software firm, Novell Software dropped by 46%, to $50m (€44.3m), last year in spite of revenues increasing.

Newly filed accounts for the US-owned Novell Ireland Software Ltd show a drop in profit from $93.1m, but a rise in annual revenues from $273.48m to $286.89m.

The company, based at the Sandyford Business Estate in Dublin, acts as the principal for the Novell group operations in the Europe, Middle East and Africa territories. The firm develops, sells and installs enterprise quality software that is positioned in the operating systems and infrastructure software layers of the IT industry. The firm — which employs 91 people at its Dublin base — last year paid dividends of $85m following a dividend payout of $50m in 2013.

According to the directors’ report, the decrease in profitability “is primarily due to the profit on disposal of intellectual property contract rights in the prior year”.

The directors further state: “Turnover has increased versus prior period. There are no significant increases in forecast revenues for 2015. Cost of sales and distribution costs have increased. Administrative expenses have decreased due to cost-saving initiatives. There are no significant increases in forecast costs for 2015.”

The accounts show that the firm absorbed $301,311 in the “cost of restructuring the company”. Accumulated profits at the firm last year reduced from $60.85m to $18.17m arising from the dividend payout. The firm’s shareholder funds totalled $81.38m; that included cash of €35.37m. The directors state they are satisfied the company does not face any liquidity issues.