Profits at Ireland’s largest childcare group ballooned during the pandemic after it received more than €19 million in Covid supports from the Government over three years, new accounts reveal.
Giraffe Childcare, which operates some 24 creches around Dublin and in counties Meath and Kildare, received €6.67 million, €10.54 million and €2.07 million in Covid grants in 2020, 2021 and 2022, according to accounts filed with the Companies Registration Office (CRO) recently.
The accounts show that, at the end of 2022, Giraffe Childcare’s owner, the investment arm of a Canadian pension fund, was sitting on accumulated profits of €19.6 million, up from just €1.4 million at the end of 2019.
Giraffe was profitable before the initial outbreak of Covid-19 in Ireland in early 2020. Operating profits at the group of creches reached €2.7 million in 2019, the last full-year of trading before the pandemic, on revenues from creche fees of €21.8 million.
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In 2020, revenues dipped to €14.4 million, due to the closure of the childcare sector over periods during the year. Despite the decline in creche fees, operating profits at Giraffe Childcare increased in 2020, from €2.7 million the previous year to almost €3.4 million, largely due to the almost €6.7 million it received from the State.
The company also paid about €1.7 million in dividends to shareholders in 2020.
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Trading revenues at the group slightly exceeded pre-Covid levels in 2021, according to the latest filings. Pretax profits, meanwhile, shot up to almost €13.5 million in 2021, largely due to the €10.54 million it received in Covid subsidies in that year, representing a 500 per cent increase from pre-Covid 2019.
Giraffe received a further €2.07 million in supports in 2022, bringing to more than €19 million the total received during the pandemic.
Asked whether the company intended to pay back the grants, given its profitability, a spokeswoman for Giraffe Childcare told The Irish Times: “Like all childcare providers, we faced unprecedented challenges during the pandemic and worked hard to stay open, to support working families and to retain the 550 highly trained practitioners we employ.
“We were grateful for the Government support during that period, and since the pandemic we have made significant investments in the childcare sector opening four new centres with plans for further expansion in 2025.”
The latest filings, covering the 2021 and 2022 financial years, are out of date after the company missed its statutory filing deadlines.
The CRO afforded the company extra time to file accounts during the pandemic as part of a moratorium on late filing penalties. The additional delays, however, remain unexplained, although the company is understood to have blamed an administrative error.
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A spokesman for the Department of Children said the department did not comment on individual cases. “Covid grants to the early-learning and childcare sector were subject to audit verifications therefore protecting exchequer funding,” he said.
Founded in 2001 by Mary Ann McCormack, Giraffe Childcare was acquired in 2019 by the Ontario Teachers’ Pension Fund for a reported €30 million.
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