Farmer Business Developments plc has confirmed that it recorded a profit after tax of €17.93 million for last year.
According to financial documents released today (Wednesday, May 17), this is up by over 80% compared to the 2021 figure of €9.89 million.
The investment company said that the “strong results” were driven by an “excellent performance” by its FBD Hotels and Resorts and the resumption of dividend payments by FBD Holdings following the Covid-19 pandemic.
Farmer Business Developments proposed to pay shareholders a 9c dividend per share, which is up 28% from the 7c paid in 2022.
Subject to approval at the company’s annual general meeting (AGM) on June 9, the dividend is scheduled to be paid on June 27.
The investment holding company, which was established in 1988, has over 4,000 mostly farmer shareholders, owns 24% of FBD Holdings plc, whose main business is FBD Insurance.
It also owns 100% of FBD Hotels and Resorts, a property and leisure group with four hotels in Ireland and two resorts in Spain, a majority stake in development land close to the new Berlin airport and a number of smaller investments.
Profit
The annual report shows “an exceptional recovery” for FBD Hotels and Resorts following the easing of Covid-19 restrictions with a record profit of €18.75 million, compared to a profit of €13.1 million in 2021.
The documents show that the dividend income for the company from FBD Holdings was €8.75 million.
The German-based Bulberry Properties, in which Farmer Business Development has a 61% stake, did not carry out any land transactions in Berlin during 2022 and made a loss of €960,000.
Bulberry has a 3.3ha plot of development land close to Berlin’s new Willy Brandt Airport, the only airport serving the German capital.
Farmer Business Developments said that it is biding its time with the Berlin investment to ensure it maximises its value at exit.
The company’s property partnership with developer Taylor Wimpey at La Cala Resort had “another record year” with the sale of 73 built units and five villa plots.
This generated €10.7 million in cash for Farmer Business Developments.
The company recently signed a contract with Taylor Wimpey for a second development at La Cala.
In his first chairman’s statement, Pat Murphy paid tribute to the late Padraig Walshe who passed away suddenly in February.
The Co. Laois farmer and former president of the Irish Farmers’ Association (IFA) had been chair of Farmer Business Developments from 2010 until his death.
Murphy said that Padraig Walsh “gave outstanding service and leadership” to the company.
“I want to build on the progress we have made under Padraig and focus on continuing to deliver superior returns to our shareholders,” he added.
In recognition of his contribution to the farming community, the board of the company has decided to establish “an initiative to honour Padraig’s legacy”, with further details to be announced “in due course”.
Shares
Murphy said that following the success of last year’s voluntary share buy-back scheme, the board is proposing to run a similar scheme worth €3 million this summer with a buy-back price of €1.91/share, which is 25% higher than the 2022 price.
The company will write to all shareholders in June giving them the option to apply for the new scheme.
The company has also ruled out an in-house share-trading service “due to regulatory restrictions”. It will instead offer the sale of treasury shares to shareholders wishing to increase their shareholders or to new farmer investors who want to build their portfolio.
“We have a strong balance sheet with modest debt levels and have confidence that our business and investments will continue to deliver superior returns to our loyal shareholders,” Murphy said.