Ireland: Tobacco Firm''s Profits Tumble 6%

Source from:  Irish Examiner  11/29/2012

Pre-tax profits at tobacco firm PJ Carroll last year fell 6% to €8.4m as the number of cigarettes legally bought in the State last year fell from 4.3bn to 4.1bn.

Accounts just filed with the Companies Office by PJ Carroll & Company Ltd show gross revenues at the firm last year fell 2.4%, from €251.7m to €245.6m.

After accounting for €211.1m paid in duty excise and other taxes last year, the firm's net revenues last year fell from €35.5m to €34.5m.

According to the directors' report, the decline in revenues in the firm, which is owned by British American Tobacco, "was driven by volume reductions of 2.4% as a result of market contraction".

The firm says the overall decline in the market "was primarily due to the growth of illicit trade".

The directors state: "Overall market share for the year was 15.97% which is comparable to 2010."

They say the reduction in operating profit was due primarily to reductions in sales and marginal increase in input prices.

The paid a dividend of €6m last year.

A note in the accounts states: "PJ Carroll & Company, as well as other leading cigarette manufacturers, have been named as defendants in a number of product liability cases in the Republic of Ireland.

"The vast majority of these claims have been terminated through the dismissal of these claims by the courts or through the plaintiffs choosing to discontinue with their claims.

"As at December 31st 2011, 15 plaintiffs have claims remaining against PJ Carroll & Co Ltd and/or its subsidiaries. There are presently 20 cases remaining against the industry as a whole in the Republic of Ireland.

"PJ Carroll & Company intends to defend all the claims vigorously and has available to it substantial defences both on the law and the facts.

"Since the amount of damaged claimed has not been specified, it is not possible to determine the total amount of the claims pending, but the aggregate amounts involved in such litigation are potentially significant."

The figures show the numbers employed by the company last year fell from 44 to 42, with staff costs down from €4m to €3.8m. Enditem