Donegal Investment Group reports fall in profits

Dublin-listed Donegal Investment Group saw pretax profits fall by more than 10 per cent last year despite a rise in turnover.

The food group, which rebranded from Donegal Creameries in 2013, operates across agri-inputs, produce, property and other investments. It has operations in Ireland, the UK, Holland and Brazil.

Donegal recorded full-year pre-tax profits of €3.7 million versus €4.2 million in 2014 on revenues that were up 2.7 per cent from €81 million to €82.9 million. Operating profit increased from €900,000 to €1 million.

The group said that as with 2014, last year saw continued challenges for its produce seed potato business and further progress for its speciality dairy division.

Chairman Geoffrey Vance said the first half of 2015 was impacted by a reduction in demand for see potato across Europe while the second half saw difficult trading conditions in the Middle East and import regulation changes in one of its primary North African markets.

“We have taken a number of actions to improve the performance of produce seed potato with a view to returning it to profitability,” said Mr Vance.

The group reported adjusted earnings per share of 26.6 cent for fiscal 2015, a decrease of 17.6 cent on the previous year.

Donegal’s balance sheet remained reasonably strong with shareholder funds of €60.7 million. Net debt reduced by €4.6million, primarily due to the proceeds of the sale of the Ballyraine Halls student accommodation.

“The exceptional progress in the development and scaling of our speciality dairy business has continued throughout the year with new product development gaining traction in the market with demand and listings for our established products continuing to grow at a significant rate,” said Mr Vance.

“Our animal feeds business experienced a satisfactory 2015 with reduced selling prices being offset by expansion into new areas and increased tonnage,” he added.