Business

Chanelle Pharma profits fell ahead of takeover

Drop in 2023 earnings came before February’s takeover by Exponent

Chanelle founder and owner Michael Burke sold the business he founded over 40 years ago for around €300m. Photograph: Michael Dillon

Gordon Deegan
Wed Feb 21 2024 - 17:00

Pretax profits at the Co Galway-based Chanelle Pharma group decreased by 42 per cent to €13.7 million last year due to higher costs.

Earlier this month, vet-turned-businessman, Michael Burke sold Chanelle Pharmaceuticals he founded more than 40 years ago in a deal understood to be about €300 million to British private equity group, Exponent.

Newly filed consolidated accounts for Chanelle Pharma Ltd, show the group recorded a drop in pretax profits even as revenues rose by 5 per cent to €171.12 million in the 12 months to the end of April 30th last.

Earnings were hit after the cost of sales increased by 15 per cent rising from €108.13 million to €124.66 million.

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The group last year paid out dividends of €5.75 million and this followed a dividend payout of €10 million in the prior year.

The accounts were signed off on December 8th ahead of the Exponent deal and sounding an upbeat note on the business’s prospects, the directors state: “Trading since the start of the new financial year has been encouraging. The indications at this stage are positive with strong market demand for our products and delivery pipeline.”

On the group’s future developments, the directors state that “the company will continue to pursue new opportunities to grow its products and customer base, through a combination of organic growth, product delivery and expansion of our manufacturing capabilities in our facilities”.

They state: “Numerous marketing authorisations for product approvals have been achieved throughout the year as well as a number of license and supply agreements. Although none are material in their own right, they all strengthen the existing product portfolio.”

The profit takes account of non-cash depreciation charges of €3.76 million and research and development costs of €3.3 million.

Numbers employed by the Michael Burke-founded group increased from 595 to 660 as staff costs increased from €28.9 million to €33.39 million.

The group’s post-tax profit last year was €11.07 million after incurring a corporation tax charge of €2.6 million.

Directors’ pay last year increased sharply from €468,4082 to €764,784. Key management personnel were paid €1.65 million.

Gordon Deegan

Gordon Deegan

Gordon Deegan is a contributor to The Irish Times

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