Long hot summer and football that gave Simons Farsons Cisk record year

The Simonds Farsons Cisk group has registered a record performance during the financial year ending 31 January 2013, with profit before tax surpassing last year's comparative figure of €5,080,000 by 28% to reach €6,481,000.

Group turnover increased by 9% to reach €77,180,000, with increases being registered in all segments in which the  group operates. In particular, the importation of food and beverages registered the highest growth in turnover, while the manufacturing operation registered the highest improvement in profitability.

Whilst the gross profit for the group reached record levels at €28 million, exceeding last year by 10%, the group managed to contain its selling, distribution and  administrative costs at 26% of its turnover compared to 27% attained during the previous financial year, despite a material increase in impairment provisions on receivables following a group-wide decision to adopt a more prudent approach.

Although competition remains intense, buoyant tourism, a prolonged hot summer and Euro Cup activities were all factors which helped boost demand. The performance of Cisk and Kinnie were instrumental to the increased turnover and profitability of the core segment. The excellence in quality coupled with focused marketing and sales initiatives continued to support the positive results from these brands.

The beverage importation division also posted an encouraging performance with notable increases in spirits and energy drinks.

On the other hand, the food importation arm is going through a period of reorganisation and consolidation in the light of market realities, where the private label concept has become an acceptable alternative and has consolidated and expanded further.

The franchised foods retail establishments registered improved turnover and profitability with increased sales in all three franchises. Performance of the KFC brand surpassed expectations, and excelled both in terms of turnover and profitability.

The group's statement of financial position remains strong and the net asset base continued to improve by €3,739,000 to reach €91,925,000 (2012: €88,186,000). Shareholders' funds finance 61% (2012: 60%) of the group's total assets, while EBITDA (earnings before interest, tax, depreciation and amortisation) increased to €13,983,000, representing a marked improvement of 22% over the previous year.

The future outlook at Farsons is based on further growth, which will continue to be spearheaded through more innovation,  along with added focus on the drive in export markets. The group's business also remains dependent on local consumer confidence and the state of the tourism industry.

The determined focus to reduce the group's energy consumption and water usage will remain a priority. Through energy saving investments, this will not only further strengthen competitiveness but also deliver environmental improvements beneficial to the common good.

The board remains determined to sustain the group's competitive advantage through continued change and investment, to ensure alignment to market developments, remaining well positioned to take on new challenges and opportunities. The recent completion of the investment in the new brewhouse, inaugurated in September 2012, is already rendering our beer production more competitive, this is also in line with our declared strategy of growth through the export markets.

The group has ambitions to continue to grow, exploit and develop all segments that offer potential and opportunity.

With continued visionary foresight and the necessary strategic thinking, followed by the right decisions and successful implementation, the board is confident that it will face the challenges going forward with vigour and energy.

The directors declared a net interim dividend of €400,000, which was paid on 19 October 2012 to the ordinary shareholders, and will recommend the payment of a final dividend to the ordinary shareholders of €2,100,000 at the Annual General Meeting scheduled for 20 June 2013. The interim dividend was paid out of tax exempt profits. If approved at the Annual General Meeting, the final dividend will be paid on 21 June 2013 (also out of tax exempt profits) to the shareholders who will be on the register of members of the company on 21 May 2013.

As a result, total declared dividends relating to the financial  year ending January 2013 would equate to €2,500,000 increasing by €400,000 over the previous financial year.

Dividends to the ordinary shareholders paid during the year ended 31 January 2013 amounted to €2,100,000 (2012: €2,000,000).

Retained profits carried forward at the reporting date amounted to €24,930,000 (2012: €21,061,000) for the group and €23,584,000 (2012: €20,564,000) for the company.