Rollercoaster continues as profits drop at Hannons poultry

By Eric Donald

Hannon's Poultry Exporting Company Ltd, the Roscommon-based poultry company, made a lower pre-tax profit of €1.03 million in the year to the end of March 2003.

That's less than half the previous year's profit of €2.21 million.

But the results for the last three years, (see table) show the rollercoaster nature of the company's profit. The company employ around 85 people at their poultry processing factory in Roscommon.

Subsequent to the end of the company's financial year, Hannon's Poultry Exporting Company Limited purchased the A ordinary shares in its parent company Hannon's Holdings Limited. These 208,166 A ordinary shares in the holding company were owned by Erin Executor & Trustee Co. This company is a subsidiary of Irish Life and Permanent Plc. Hannon's Poultry Exporting Company paid €1.28 million to buy out this shareholding. A little over €6 was paid for each A share.

Provision for this transaction was already included in these latest set of accounts. The debtors figure in the balance sheet shows a deposit on shares of €1.281 million which relates to the subsequent transaction.

Shareholders funds increased from €5.73million to €6.61million. Long-term creditors have been reduced to zero while short-term creditors have been reduced from €1million down to €692,901. During the year the company paid €250,000 in royalties to another company controlled by Ollie Hannon called Kiplink limited.

Hannons have clashed with its poultry suppliers on several occasions over the price paid for birds. Chairman of IFA's free range eggs committee John Brady said that growers are actually being charged 16 cent per bird to have end of lay hens processed. He pointed out that in Holland producers are paid 18 cent live weight ex farm for these same birds.

Similarly for breeder birds, the price paid by Hannons is 14 cent per kilo liveweight, while in Holland prices of up to 40 cent per kilo are paid.

John Brady hopes that a new plant opening in Monaghan will help to restore some competition for producers.