IRISH Fertilizer Industries (IFI) has reported strong growth in 1996, with pre-tax profits up from £18.4 million to £18.7 million, after restructuring costs of £1.7 million.
Without these restructuring costs, the Republic's biggest producer of bulk chemicals and agricultural fertiliser would have made profits of more than £20 million, indicating underlying growth of around 11 per cent last year.
IFI, which claims to supply 40 per cent of fertiliser products sold in the Irish market, recorded some slowdown in its sales last year, from £165.5 million in 1995 to £161.5 million.
IFI managing director Mr Tom Jago said yesterday the drop in sales was largely due to a general 5 per cent fall in the market for agricultural fertilisers last year.
While sales had remained "relatively buoyant" in the earlier months of the year, he said, volumes began to fall substantially in later months. Almost 90 per cent of its turnover comes from fertiliser sales with the remainder generated by sales of non-fertiliser products.
Operating margins increased slightly, rising from 12.1 per cent to 12.3 per cent, while net margins were up 11.6 per cent compared with 11.1 percent in 1995.
Operating profits ran slightly below the previous year's levels, at £19.8 million compared with £20 million in 1995. Low interest rates and reduced working capital requirements throughout the year helped to reduce IFI's interest charges from £1.6 million to £1.2 million.
Over the past 12 months, IFI invested £13 million in its three facilities at Cork, Arklow and Belfast, as part of its efforts to improve the efficiency and competitiveness of its manufacturing processes.
Despite this heavy capital outlay, Mr Jago said its borrowings are now negligible. Over the past 10 years IFI has made steady progress in reducing its debts. In 1987, the company reported debts of £32 million. Last year, Mr Jago said this fell to around £200,000.
The group's balance sheet shows shareholders' funds up from £56.5 million to £67.5 million after dividends of £7.5 million.
Commenting on the latest figures, Mr Jago said the results were "particularly pleasing" given the high level of investment undertaken by IFI throughout last year.
The European fertiliser industry is emerging from a very difficult period. Over the past three years, firms like IFI have had to operate in an environment where demand for its products has declined, while prices have also been pushed sharply lower due to intense competition for market share.
Mr Jago believes this has however now been largely corrected, reporting some signs of recovery in both demand and general price levels.
IFI, he said, has also improved its productivity levels over the past 12 months. Staff levels are now 55 per cent lower than 10 years ago, with just 630 people employed by the group in 1996, while production has risen by 55 per cent.
IFI's new joint venture with the US-based Rochester Midland Industries has operated "satisfactorily" in the last financial year, Mr Jago said.
RMI, which provides specialist environmental services for heavy industry in Ireland and the UK, has signed a contract to supply the Norwegian company, Dyno Industries, which is completing a resin production plant beside IFI's Cork facility.
