Londis' profits increase by 35% to €1.67m

Tuesday 08 April 2014 11.06
Londis Chief Executive Stephen O'Riordan announced an increase in profits of 35% to €1.67m
Londis Chief Executive Stephen O'Riordan announced an increase in profits of 35% to €1.67m

ADM Londis recorded a profit before tax of €1.67m for the year ended 31 December 2013. This was an increase of 35% on the prior year' s performance of €1.23m.

The wholesaling group is owned by the network of Londis convenience store retailers.

It said that profit from ordinary trading improved as a result of a more favourable mix of sales with reduced reliance on low margin categories and increased volumes through Londis' higher margin chilled distribution network.

The company said that the conclusion of a 10 year goodwill amortisation process for its Londis Top Shop acquisition in 2003 also delivered a year on year benefit to the business of €0.35m.

Total revenue in 2013 declined by 4.4% to €195m from €204m, driven mainly by a decline in the tobacco and call credit categories and the closure of a small number of underperforming stores.

"2013 was a very successful year for the group with profits up substantially, a sustainable increase in margins and further enhancements to our buying power, marketing execution and capital structure," said Stephen O'Riordan, ADM Londis' Chief Executive.

One of the Group's major developments in 2013 was an agreement to join the Stonehouse Group and thereby leverage a combined buying power of close to €1.5billion at retail level. This strategic buying arrangement will be margin enhancing and will enable Londis' retailers compete all the more aggressively with international multiples and discount chains.

Despite a challenging market for independent retailers, Londis' store recruitment gained traction in the second half of the year, culminating in seven new store openings by year end.

"The group is beginning to see the trading benefits of new stores recruited to the group in 2013 and this has been further underpinned by our new partnership agreement with the Griffin Group post year end. We see this as a strong endorsement of the Group's retailer offering and partnership approach", Mr O'Riordan added.

Total Shareholders' funds increased by 7% to €20.4m (up from €19.1m in 2012) with net debt significantly reduced to €1.1m (from €3.0m in 2012). A dividend of 0.25 cent per share has been proposed for 2014.