Wage inflation pressures and other external economic pressures contributed to pre-tax profits at the Irish arm of cleaning and security services group Bidvest Noonan Services last year declining by 13% to €26.7m.
New accounts for Bidvest Noonan (ROI) Ltd show that the business recorded the decrease in pre-tax profits as revenues rose by 2% from €328.8m to €335m in the 12 months to the end of June last.
The pre-tax profits of €26.7m follow pre-tax profits of €30.65m in 2024.
The firm last year paid out a dividend of €44m - more than three times the €12m dividend payout in the prior year.
The directors state that the company performed strongly during the year "and we are pleased to report an increase in revenues, reflecting our strong market position and successful strategic initiatives".
"Despite this growth, our profitability has been impacted, largely due to a change in mix of services delivered, wage inflation pressures and other external economic pressures," the directors say.
They add that "however, in a year of high inflation, administrative costs were effectively managed, demonstrating our commitment to operational efficiency and fiscal discipline".
The directors state that the business "remains focused on leveraging revenue growth to further improve profitability in the coming year".
The firm recorded a post tax profit of €24.53m after incurring a corporation tax charge of €2.17m.
South African-based Bidvest purchased Noonan Services Group for €175m in 2017.
Numbers employed at the Irish unit last year decreased by 953 from 9,667 to 8,714 though staff costs rose by €14.4m from €249.64m to €264m.
Pay to directors increased from €2.92m to €3.92m made up of aggregate emoluments of €2.58m; €902,000 in share based payment expenses, €196,000 in pension contributions and €244,000 in termination payments.
A breakdown of revenues shows that revenues from cleaning and facility services dipped slightly from €179.3m to €177m; revenues from security services increased marginally from €99.1m to €100.74m while revenues from 'other services' rose by €6.8m from €50.4m to €57.24m.
The profit last year takes account of combined non-cash depreciation and amortisation costs of €3.69m.
On the risks facing the business, the directors state that operational risks include health and safety, environmental, talent availability and retention, cyber security and macro-economic factors with inflation and statutory changes to labour rates a key factor which can impact supply lines.
They state that commercial risks include lost contracts, unprofitable contracts, and bad debts.
The directors state that existing contracts are managed with innovative service offerings, focus on maintaining strong customer relationships, and cost controls.
At the end of June last, the group had shareholder funds of €150.14m that included accumulated profits of €56.4m.
The group's cash funds decreased during the year from €30.85m to €23.44m.
Bidvest Noonan employs over 27,000 people across the UK & Ireland and is the market leader for a wide range of outsourced services in Northern Ireland and the Republic of Ireland.
Reporting by Gordon Deegan
