Pre-tax profits at Circle K Ireland Energy last year almost halved to €6.9 million.
New accounts for Circle K Energy Ireland Ltd show that pre-tax profits reduced by 46 per cent as revenues declined by 27 per cent from €1.72 billion to €1.25 billion in the 12 months to the end of April.
The main activity of the company is the marketing and distribution of fuels and petroleum products as Circle K reports its retail revenues here in a separate company.
The pre-tax profits of €6.9 million follow pre-tax profits of €12.7 million in the prior year.
The directors state that “lower selling prices for fuel and petroleum products reflected the decline in commodity market prices and resulted in revenue that was lower than in the prior year”.
The company’s cost of sales also declined by a corresponding 27 per cent from €1.66 billion to €1.2 billion.
The company’s gross profit of €39.8 million was 28 per cent below the prior year’s gross profit of €55.77 million “resulting in gross margin percentages remaining reasonably stable across both years” according to the directors.
The directors state that a transfer pricing policy is in place, to ensure that the sale of petroleum products between group companies is at arm’s length, which can have an impact on the company ́s operating profit result, year on year.
They state that as a result, operating profit decreased by 28 per cent from €15.34 million to €10.95 million and higher net finance expenses of €3.98 million contributed to the decrease in the pre-tax profit of €6.9 million.
The company recorded a post tax profit of €5.58 million after incurring a corporation tax charge of €1.3 million.
On the company’s future developments, the directors state that it is “well positioned to grow its business for the foreseeable future. The company will focus on seeking to grow organically”.
Numbers employed here declined from 150 to 147 as staff costs increased marginally from €8.92 million to €8.96 million.
Staff costs included €283,000 in redundancy costs which followed a payout of €163,000 under that heading in fiscal 2023.
Pay to directors increased from €1.29 million to €1.92 million.
The profits take account of non-cash depreciation costs of €6.5 million.
At the end of April, the company had shareholder funds of €77.17 million that included cash funds of €4.2 million.
The Circle K brand looked to expand here last year with the purchase of nine forecourts and convenience shops from retail group Pelco operated by Paul Fitzgerald and Lynda Fitzgerald.
Pelco recorded revenues of €59 million and pre-tax profits of €1.43 million in 2023.
Last month, consumer watchdog, the Competition and Consumer Protection Commission (CCPC) launched a full investigation into the proposed Circle K purchase.
Should the deal get the green light, the expansion would increase the total number of Circle K locations in Ireland to 419 and stores from 168 to 177.
Circle K’s ultimate parent company is the Canada based Alimentation Couche-Tard Inc.
Sourse: breakingnews.ie
