independent

Friday 18 April 2014

Profits halved at Lir after packaging write-down

A file picture of Mary White, the founder of Lir Chocolates, which is now owned by German firm Zertus

Profits at Lir Chocolates – the well-known Irish confectioner now owned by German firm Zertus – nearly halved to €370,500 last year as it wrote off almost €192,000 worth of packaging that it is no longer using.

Lir Chocolates was founded by Senator Mary White and Connie Doody in 1987.

It was acquired by UK firm Zetar in 2007 in a deal worth as much as €8m. Zetar, whose shares had been quoted on London's Alternative Investment Market, delisted as a public company last week. It has been acquired by Germany firm Zertus.

The latest accounts for Lir – for the 12 months to the end of April – show that gross profits jumped to just under €5m from €4m a year earlier. But administration expenses soared to €3.5m from €2.5m. That left the company, which employs about 200 people, with a pre-exceptional operating profit of €562,000 compared to €669,000 a year earlier.

The company's products are sold across Ireland and Britain and it also produces own-brand chocolates for a number of multiples.

Ms White and Ms Doody continue to be directors of Lir, as does Hugh O'Brien. Mr O'Brien had invested in the business in 2000, making him one of the largest shareholders in the company.

The latest set of accounts note that a company in which Mr O'Brien is a partner – HKM Partnership – was paid rent of €205,000 by Lir last year. Lir also paid Mr O'Brien €91,500 last year for services to the chocolate company.

During the summer Zetar said that the overall chocolate market had been "challenging" and said that it had recorded an "unprecedented disappointing Easter" across its Lir business and another division in the 2012 financial year.

But Lir-manufactured Baileys chocolates maintained their position as the UK's number one alcohol chocolate brand and reported sales of £13m (€16m) in the year to the end of last April.

"Conversely, following the autumn relaunch of Lir as a more focused range of affordable luxury chocolates in its new livery, the brand grew by 41pc," noted Zetar.

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