One of the main Irish subsidiary's of Cadbury owner Mondelez returned to profit last year but has warned of challenging market conditions.
Mondelez Ireland, which has seen its Irish workforce decline dramatically in recent years, made an operating profit of €1.1 million for the year ended December 31st, 2016, which was up from a loss of €3.1 million the year before, its latest accounts show.
Over the period, the firm reduced its administrative expenses by €6.5 million, bringing them down from €24.5 million in 2015 to €18 million last year. Cost of sales also came down from €174 million to €171 million.
Furthermore, the company reduced the number of staff on its books from 120 to 103, and cut the amount it was spending on wages and salaries from €8.5 million to €6.3 million.
The firm's two directors, Eoin Kellett and Stephen Dillon, received aggregate pay of €475,000, which was down from €616,000 the year before.
In the accounts, the directors said market conditions “continue to be challenging” in all categories it operates in, including confectionary, cheese and groceries. They cited “the weak economy” and a knock on effect on consumer spending.
“The business looks to drive performance by launching new product innovation, building brand awareness through media campaigns, increasingly using new social media platforms, and working with customers in building the categories we work in,” they said.
Turnover decreased from €208.1 million to €190.2 million, driven by the discontinuation of the coffee business in July 2015. It generated a profit of €8.9 million on the sale of its coffee business to Jacobs Douwe Egberts in 2015.
The company, which is one of two Mondelez units in Ireland, recapitalised its balance sheet in 2015 to address its pension scheme deficit.
The parent company, Kraft Food Schweiz Holding, subscribed for the allotment of 1,000 ordinary shares of €1.27 each at an aggregate price of €98 million.
Mondelez closed its gum-base production plant in Tallaght in 2014 with the loss of 45 permanent roles. It also cut 160 jobs at its other facilities in Coolock, Co Dublin, and Rathmore, Co Kerry.
In addition, the firm announced a €11.7 million investment in new chocolate-making technology at the Coolock facility to concentrate production on core chocolate brands at the same time.
Cadbury built its first Irish factory at Ossory Road, Dublin, in 1933. Kraft Foods acquired Cadbury in 2010, and two years later spun-off its North American grocery division, including Cadbury, and renamed it Mondelez.
