Tobacco Firm's Pre-Tax Profits 11% in 2008

Source from:  Irish Examiner 10/15/2009

TOBACCO firm PJ Carroll saw its pre-tax profits increase 11% to €10.7 million last year despite falling cigarette sales. The Dublin-headquartered company, which is owned by British American Tobacco, said its overall market share in Ireland for 2008 was 15.4%, down from 16.1% in 2007. PJ Carroll lags behind Gallahers and Imperial Tobacco which hold about 75%. In addition to the Carrolls brand, it also distributes Rothmans, Major, Kent, Dunhill and Lucky Strike. The increase in profit, in the year to the end of December 2008, was achieved despite a 2% fall in sales last year to €224m which it said was due to price increases and one off benefits in administration expenses. Capital reserves at the end of 2008 were €18.4m versus €24.5m at the end of 2007. Dividends of €7.8m were paid during the year. The company employed 70 people at the end of last year down from 83 in 2007. Staff costs fell slightly from €5.8m to €5.5m last year. The accounts said the key risks and uncertainties facing the business are the product liability cases outstanding against the company and the Irish Government's legislative programme directed at reducing the consumption of tobacco in Ireland. PJ Carroll says it is facing 15 cases in the courts from smokers and their families and there are 20 against the industry as a whole in Ireland. It said, however, that the vast majority of product liability cases against it and other cigarette manufactures have been terminated through the dismissal of these claims or through the plaintiffs choosing to discontinue with their claims. "If despite the defences available to PJ Carroll & Company Limited there were to be adverse final judgements, such developments could materially affect the results of operations or cash flow of the group. However … PJ Carroll & Company Limited intends to defend all the claims vigorously… If adverse judgment were entered against PJ Carroll & Company Limited in the first instance, a right of appeal would exist," the accounts read. Enditem