Pre-tax profits nearly double at Gleeson’s
The Gleeson Group was well on the way to doubling its profits in the 12 months to June last year in spite of the economic freefall being experienced by commercial interests everywhere.
15 March 2011
Pre-tax profits rose by 85.4 per cent from €2.68 million to €4.97 million on a turnover down again, this time by 4.3 per cent to €220.46 million from €230.26 million.
"We have been badly hit by a range of factors” reported Gleeson Group’s Chief Executive Pat Cooney, “but we’ve been careful and cost management is the key thing, there’s no great mystery to it".
Despite an increase in personnel to 653 (from 2008-2009‘s 639), sales costs were cut by nearly €10 million from €191 million to €181 million while administration and distribution costs were reduced by nearly €1 million. Interest repayments too came down by over €1 million to €1.5 million.
Owned by the Cooney family since 1974 Gleeson Group has 21 subsidiaries involved in drinks wholesaling and distribution, Tipperary Water and Devil’s Bit cider manufacturing and distribution as well as soft drinks and ice-pop manufacturing and distribution activities.
Gleeson’s recently-purchased Gilbeys Wine from Diageo which provided a considerable addition to its previous wine portfolio to the point where it now has around 15 per cent of the wine market.
The profit figure would have been higher had the company not suffered from having to pass on an excise duty cut which came into effect two weeks before Christmas as a result of the 2009 Budget, having purchased stock well in advance for the seasonal market at the higher pre-Budget tax level.
"We took a €1 million hit on that because the rate changed two weeks before Christmas when warehouses were full and we had to sell the stock at the lower prices," explained Pat Cooney. However the company is currently involved in a legal challenge on this which has yet to be heard.