Glennon Brothers returns to profit

Ireland-based sawmiller Glennon Brothers has returned to profit thanks to strong performances in its UK businesses.

The Longford-based business, which has three companies in the UK, said pre-tax profit for 2009 was €4.6m (2008: €1.1m pre-tax loss), from a turnover of €57.1m.

Glennons joint managing director Mike Glennon told TTJ that UK operations performed strongly and the group also received the benefit of the full 12 months of trading of Troon-based Adam Wilsons & Alexanders Timber Design (also based in Troon), following the acquisition in April 2008.

Mr Glennon said the UK performance masked a significant drop in the group’s Irish business turnover caused by the collapase of the Irish housebuilding industry.

Despite the profitability downside in Ireland, he said group achievements in 2009 included a refocusing of the business to explore new market opportunities and tackle its cost base in Ireland, opening up another Euro market with its first shipment to France and making good progress in developing the customer base in the UK “which has helped enormously in 2010”.

This year Glennons said it was happy with the performance of UK operations considering harsh weather conditions in the first quarter and during this month.

“We will double our exports from Ireland in 2010 compared to 2009,” he said.

“This is a tremendous testimony to the hard work, dedication, and flexibility of our Irish workforce, from the forest, right through production and sales into the market place.”

But Irish log costs have doubled compared to a year ago due to sawmilling market overcapacity and the dominance of Coillte in the market.

“This log cost increase has eroded the profitability of the Irish sawmilling sector in 2010.”

Mr Glennon said the various stakeholders in the sector needed to come together to find a solution to the capacity issue.

“Looking forward to 2011 we share the view that it will be a challenging year. In the Irish context the industry will be condemned to a break-even position at best but more likely loss-making, unless the issue of log costs is tackled.”