Circle K profits fall 42% as drop in petrol price results in revenues declining to €1.25bn

Circle K directors say 'lower selling prices for fuel and petroleum products reflected the decline in commodity market prices and resulted in revenue that was lower than in the prior year'. File picture: Colin Keegan/ Collins

Pre-tax profits at Circle K Ireland Energy last year almost halved, to €6.9m.

New accounts for Circle K Energy Ireland Ltd show pre-tax profits reduced by 46% as revenues declined by 27%, from €1.72bn to €1.25bn, in the 12 months to the end of April last.

The main activity of the company is the marketing and distribution of fuels and petroleum products, as Circle K reports its retail revenues here in a separate company.

The pre-tax profits of €6.9m follow pre-tax profits of €12.7m in the prior year.

The directors say “lower selling prices for fuel and petroleum products reflected the decline in commodity market prices and resulted in revenue that was lower than in the prior year”.

The company's cost of sales also declined by a corresponding 27%, from €1.66bn to €1.2bn.

The company’s gross profit of €39.8m was 28% below the prior year’s gross profit of €55.77m, “resulting in gross margin percentages remaining reasonably stable across both years”, according to the directors.

The company recorded a post-tax profit of €5.58m after incurring a corporation tax charge of €1.3m.

On the company’s future developments, the directors say it is “well-positioned to grow its business for the foreseeable future. The company will focus on seeking to grow organically.”

Numbers employed declined from 150 to 147, as staff costs increased marginally from €8.92m to €8.96m.

Staff costs included €283,000 in redundancy costs, which followed a payout of €163,000 under that heading in fiscal 2023.

Pay to directors increased from €1.29m to €1.92m.

The profits take account of non-cash depreciation costs of €6.5m.

At the end of April, the company had shareholder funds of €77.17m, that included cash funds of €4.2m.

The Circle K brand looked to expand here last year with the purchase of nine forecourts and convenience shops from retail group Pelco operated by Paul Fitzgerald and Lynda Fitzgerald.

Last month, consumer watchdog, the Competition and Consumer Protection Commissionlaunched a full investigation into the proposed purchase.

Should the deal get the green light, the expansion would increase the total number of Circle K locations in Ireland to 419, and stores from 168 to 177.