Barry's Tea, the Cork-based tea processing and wholesaling group owned by former government minister, Mr Peter Barry, made a gross profit of €13.7 million in the year to end-April 2003, according to accounts just filed.
Accumulated profits dropped from €54.8 million to €12.2 million during the year. This was due in the main to an exceptional item of €50 million described in the accounts as a provision for the diminution in value of investments.
No representative of the group was available to comment on the accounts.
In December of last year it was announced that Barry's Tea and Bank of Scotland (Ireland) had joined forces to buy Northern Foods-owned Batchelors in a 95 million deal, and the drop in accumulated profits may be linked to the making of this investment.
The Batchelors deal involved the establishment of a joint venture vehicle, Maiden Acquisition Company, through which the Barry's Tea group and the bank made their investment.
At the time of the investment Barry's Tea said it had been looking for an opportunity to invest in a well-established food company with a potential for growth.
The consolidated accounts for Barry's (Cork) Ltd and subsidiaries describe the principal activities of the group as being its tea operations and the holding of investments.
The group paid a dividend of €250,250 at the year's end. Corporate tax paid on the profit for the year was €723,997.
The accounts show that turnover during the year was €24.6 million and the cost of sales was €10.9 million. Gross profit in the year to end April 2002 was €12.9 million and profits before tax were €6 million. The group had €2.6 million in cash at the end of the 2003 financial year.
Directors' remuneration was €839,559. There were two directors at year's end: Mr Greg Butler and Mr Tony Barry (44). Mrs Margaret Barry resigned from the board in November 2002.
The group employed an average of 71 people during the year, excluding executive directors, and the total payroll costs for the year were €3.8 million.
The company's subsidiaries were: the unlimited company, Barry's Tea; investment holding company, Peralba; investment company, Phorsford; and British Virgin Islands investment company, Tarena Ltd.
At the end of 2002 the group was owed €45.9 million by related parties but this figure was nil by the end of 2003.
Six companies that are related parties and that had financial transactions with Barry's Tea during the year are listed in the accounts.
The ultimate controlling party for the group during the year was Mr Peter Barry.
The latest annual return for Barry's (Cork) Ltd shows that Mr Peter Barry transferred approximately one-third of his shares to Mr Tony Barry in November 2003, still leaving Mr Peter Barry with approximately two-thirds of the group's share capital.
There were no other shareholders other than Mrs Margaret Barry, who held a very small shareholding.
According to its website, Barry's Tea accounts for 34 per cent of all Irish tea sales and the Irish tea market is worth an estimated €85 million.
Barry's Tea was founded in 1901 by Mr Peter Barry's grandfather.
Until the 1960s the company sold its tea from a shop in Cork. It has since developed into a national brand.
Mr Peter Barry is a former Fine Gael minister for foreign affairs.
