IRISH BISCUIT manufacturer Jacob Fruitfield returned to the black in 2009 as cost savings from a major restructuring of the business in recent years fed through to its bottom line.
Accounts for Jacob Fruitfield Food Group Ltd, which have been supplied to The Irish Times, show that it made an after-tax profit of €11.1 million in 2009 compared with a loss of €22.3 million a year earlier.
This was despite a 9.4 per cent decline in turnover to €81.6 million. The drop in revenues was largely the result of a decision to cease distributing goods for other companies. The turnaround was the result of one-off restructuring charges and exceptional costs not being repeated in 2009.
In the previous year, Jacob Fruitfield booked an exceptional charge of €7 million and restructuring costs of €23.6 million. By contrast, the biscuit maker incurred similar one-off costs of just €2.3 million in 2009.
The business went through a major restructuring in recent years as the Jacob and Fruitfield businesses were merged; its manufacturing plants in Tallaght were closed, and production was moved overseas.
Jacob Fruitfield, whose brands include Chef, Silvermints, Kimberley, Mikado, Bolands and Fig Rolls, recorded an operating profit last year of €16 million – eight times the level of 2008.
Commenting, Jacob Fruitfield’s chairman and largest shareholder Michael Carey said: “This is a very good result for us. The restructuring and redefinition of our manufacturing activities has been successful. The new model has worked and it’s showing in these results.”
Mr Carey said like-for-like revenues last year were “flat” as the recession forced it to discount prices. “This year is intensely more competitive and we’re putting significantly more resources into promotional activity, advertising and price reductions to compete with UK-based competitors.
“[But] our brands have performed strongly. Chef did well and Jacobs gained one [percentage] point in share.”
The group is currently running a €1 million television ad campaign for Fig Rolls.
Mr Carey said turnover in 2010 will be lower than last year. “We will sell a similar amount of product, but prices have come down so the revenue line will be lower this year than last.” He declined to comment on the profit line.
No dividend was paid to shareholders in 2009. The profits were offset against its accumulated losses, to leave the business with a deficit of €28.6 million at December 31st last.
The accounts show that Jacob Fruitfield reduced its cost of sales by €5 million to €40 million.
Distribution costs fell by 10.7 per cent to €17.3 million while its administration expenses came in 52 per cent lower at €7.8 million.
The number of employees declined to 102 last year from 317 in 2008. Total staff costs fell to €7.5 million from €17.8 million, while directors’ remuneration was flat at just more than €1 million.
Jacob Fruitfield closed the year with net debt of €38.6 million, up from €34.8 million in 2008.
The company spent €3.9 million last year renting properties in Tallaght and Drogheda from Westport Investment Property Fund, which has common shareholders, including Mr Carey.
