Arrabawn’s operating profits jumped by €2.5m, following a ‘strong performance’ in 2016.
The company announced the growth as part of its annual report, which was published today, March 30.
Arrabawn’s profit before tax equalled €4.5m last year, up €3.1m on 2015. Its net debt at year-end was €12.6m, a €3.2m decrease on 2015, according to the annual report.
However, the co-op reported a turnover of €199.7m in 2016; a decrease of €5.4m or 2.7% when compared with the previous year.
The report also outlined that the company’s EBIDTA (Earnings Before Interest, Taxes, Depreciation and Amortization) totalled €9.5m last year. This represented a €3.1m increase on the previous year.
Its operating margin was up from 1.03% in 2015 to 2.32% in 2016, the report added.
The co-op believes this reduction can be attributed to the fact that 2016 represented the first full year that Arrabawn’s Nenagh plant has utilised a natural gas connection.
‘Last year re-affirmed the strength of Arrabawn Co-op’
With close to 970 suppliers; Arrabawn is headquartered in Nenagh, Co. Tipperary and has a dairies head office at its milk processing plant and distribution centre in Kilconnell, Co. Galway.
The company has three divisions, including its liquid milk manufacturing and distribution operation as well as its dairy ingredients operation.
Meanwhile, it also has an agri-business section, including 13 retail stores and a feed manufacturing facility through Greenvale Animal Feeds and Dan O’Connor Feeds, Co. Limerick.
The strong 2016 performance was further evidence of the continued benefits from an investment programme across its operations over recent years, Arrabawn CEO Conor Ryan said.
“Last year re-affirmed the strength of Arrabawn Co-op.
“We had a more-than-good performance and this will allow us to continue our capital investment programme going forward, which in turn will ensure the long-term success and viability of the organisation.
Last year alone we invested €7.2m in capital additions, with the biggest spend on our Nenagh plant.
“We also invested €1.3m in our Tyone retail operation which is, as a result, a state-of-the-art flagship store that will not just serve our suppliers and the wider farming community, but also the public.”
The robust performance of Arrabawn validates the hard work put in over previous years, that has seen the company modernise its operations, Arrabawn Chairman, Sean Monahan, said.
The co-op is ready for future growth and actively seeking opportunities for expansion, he added.
“Representing the shareholders, the bulk of whom are suppliers, as Chairman of the board, I was particularly pleased that we managed in a tough year for dairy prices to pay a very competitive milk price of 27c/L.
“With a diversified business, I have every confidence we will continue to pay a competitive milk price into the future,” Monahan said.