Flahavan’s reported a drop in profits due to rising operational costs

Finegrove Holdings, the parent company of Flahavan’s reported earnings for the year to June 30 2023 which showed turnover increased by €4.15m to €33.5m in the period while profit before tax dropped by €800,000 to €1.8m.

The cost of sales rose from €19m to €23.2m, matching the increase in turnover. The drop in profit was driven by a €770,000 increase in distribution and administration costs during the year. The average number of staff employed at the company increased from 91 to 97, with all of those extra employees in production.

The directors of the company described the level of business and the year-end financial position as “satisfactory”. They noted, as they do every year, that substantial capital expenditure will be required in the short term to maintain the productive capacity of the business.

Storage capacity

They said that a significant expenditure project is currently being planned which will see the replacement of existing conventional oat storage bins which are becoming obsolete and also will lead to increased storage capacity for organic oats.

However, the directors said the exact same thing in their 2021 and 2022 annual report, so it is unclear how likely that capital expenditure is to occur over the short term.

The company paid a dividend of €2,100 in 2023, a reduction on the €540,000 paid in 2022. Bord Bia data shows 30% of organic oats produced in Ireland are consumed here, with 35% going to the UK and the remainder going further afield.