Bathroom suite manufacturer Qualceram Shires plunged into the red last year after booking a charge for restructuring a British plant and suffering higher energy costs.

The net loss amounted to €5.39 million, exacerbated by a one-time charge of €6.1 million related to restructuring at a factory in the English town of Longton.

Qualceram posted a profit of €5.46 million in 2004.

"Intense competition, rising energy costs and subdued trade and retail sectors in Britain dictated that 2005 was to be yet another challenging year for the bathroom sector," said John O'Loughlin, Qualceram's chief executive.

Shares in the company dropped three cent, or 2.3 per cent, to €1.25.

The full-year loss comes about five months after Qualceram issued a profit warning for the second year in a row. The company said in November that 2005 results were likely to miss analysts' estimates as merchant sales continued to decline in the second half.

Qualceram generated 7 per cent less revenue in the UK last year after interest-rate increases hampered spending on home refurbishments.

While the British housing market appears to remain positive, with demand for new houses exceeding supply, housing starts will probably not rise significantly in the immediate future due to planning constraints, the listed Irish company noted.

Its UK sales rose in the first quarter from the same period the previous year.

Turnover declined 2.4 per cent, less than the 5 per cent drop predicted by the company in November.

Sales were higher than expected because of "out-turns from Ireland, Europe and the US", Gavin Kelleher, an analyst at Goodbodys, pointed out.

In anticipation of its current difficulties, Qualceram has already closed one of its plants and reduced the size of another. It has also outsourced some manufacturing to locations in Europe and Asia.

The company saw the benefits of its restructuring in the first three months of this year, Mr O'Loughlin said yesterday.