Pre-tax profits at the Irish arm of industrial diamond manufacturer, Element Six, declined by 76% to $5.22m last year due to the impact of the Covid-19 pandemic.
Revenues declined by 28% at the Shannon-based firm from $217.6m to $159.3m in the 12 months to the end of December last.
According to directors, the revenues declined by 28% "primarily driven by reduced demand as a result of Covid-19".
The company's 2019 pre-tax profits were inflated by dividends received of $11.13m that did not re-occur last year.
The directors state that "throughout 2020 and into 2021, Element Six has been able to continue to operate despite lockdowns as it is classified as a supplier of essential services".
Numbers employed reduced from 470 to 376 and staff costs last year reduced from $34.69m to $30.35m.
The company’s 2019 accounts revealed that Element Six was contesting a tax assessment by the Revenue Commissioners of a net €845,351 concerning alleged underpayment of taxes surrounding exchange rates used.
The directors confirm that "the case was withdrawn and closed by the tax authority in Q1 2021".
The company’s profits were also hit by the company reaching a $5m settlement concerning a patent infringement litigation case taken against the company.
The directors state that despite the group’s opinion that there was a strong case against the litigation, settlement discussions were initiated where there was no guarantee of a favourable outcome.
The directors state that the $5m settlement has been recharged by another group company but the cost of the settlement also appears in the Element Six Ltd accounts.
The company is currently celebrating 60 years in Shannon and has invested €16m in the Shannon site since 2017 creating 100 jobs.
Over the next three years Element Six Limited is to embark on further significant infrastructure programmes aimed at paving the way for the site’s future and improving the overall operational efficiency at its Shannon facility.
The company’s operating profits last year declined by 45% from $10.66m to $5.84m.
The profit takes account of non-cash depreciation costs of $7m
Directors’ pay last year more than doubled from $723,000 to $1.15m.
At the end of last year, the company’s shareholder funds stood at $128.7m that included accumulated profits of $22.67m.
