Monday 21 May 2018

Sherry Fitz profits up on resurgence in property

CEO Stephen McKenna.
CEO Stephen McKenna.

Gordon Deegan

The country's vibrant property sector pushed pre-tax profits at Sherry Fitzgerald up by 64pc to €3.93m last year.

Revenues rose 12pc at Sherry Fitzgerald (Ireland) Holdings Ltd, from €33m to €37.29m.

Newly-filed accounts show that executives at the company were well rewarded for their work last year with 16 directors sharing a pay pot of €3.5m that includes €220,000 in pension contributions - or €218,000 on average to each of the directors.

This year, co-founder and chief executive Mark Fitzgerald stepped down from his role after 35 years and has been replaced by Stephen McKenna.

Mr Fitzgerald leaves the business in a healthy state with the directors' report for 2016 stating it was "a year of good progress for the Sherry Fitzgerald Group as the historical commitment to invest and retain people during the challenging years of the recession began to bear fruit".

The directors said that the company now finds itself well placed in the context of a growing economy.: "In overall terms, the financial performance of the business was positive and cash generative." They cautioned that "it will be a number of years before we have a fully functioning property market with an equilibrium of supply and demand".

They added: "Our strategy is to be well prepared so that we are in a position to provide the services required but continue to run our business prudently."

Accumulated profits increased from €5.4m to €9.1m while the firm's cash pile went from €2.7m to €5.9m.

The directors said that the improvement in the company's balance sheet is indicative of the "continued investment in the business and management of working capital."

Numbers employed rose from 299 to 316 with staff costs rising from €20.9m to €23.17m. The company recorded operating profits of €3.23m and a credit of €993,000 arising from a decrease in a provision for onerous lease along with €146,000 in income from associated undertakings offset by €400,000 in surrender costs and €37,000 in interest payments resulting in the pre-tax profits of €3.9m.

The company recorded a post tax profit of €3.69m after paying €240,000 in tax.

The directors stated that "opportunities exist for the Sherry Fitzgerald Group to expand the business in a measured and responsible manner and the directors will continue to evaluate all strategic opportunities as they occur."

The directors also said that, "though unlikely, ill conceived but possibly well-motivated policy initiatives that would halt the increased supply of property, could lead to market dysfunctionality".

Irish Independent

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