Irish sawmiller Glennon Brothers said that a loss of customer confidence had hit its business in 2011, after recording a 45.5% increase in turnover in 2010.
The company has just announced its 2010 results, reporting sales of €85.5m, compared to €58.7m the year before. Pre-tax profits were €5.8m, and, at the year end, it had €17.7m cash. It also increased its workforce by 13% to 342.
Managing director Mike Glennon told Irish newspapers that 2010 had been a difficult year in Ireland, and that the 56% increase in its Irish business had been “completely eroded by high log costs”. But he said the company had moved ahead by achieving “a number of important objectives”. These included doubling exports to €20m and maintaining full output at its Irish production facilities, compared to 83% in 2009.
Mr Glennon said the company had a “strong first six months” in 2011, with good performances from its three UK businesses, timber frame specialist Alexanders Timber Design and sawmillers Adam Wilson and Windymains.
“But demand in the second half of 2011 moderated with customer confidence abating,” he said. “This will have some negative impact on performance in 2011.”
Mr Glennon also commented on the uncertainties over Irish log supply: “Once again, high log prices have impacted on the performance of the Irish business,” he said. “The importance of a continuous log supply cannot be emphasised enough, given the shortage of logs in Ireland. “
He added that, if Irish state body Coillte sold off its forests, as has been recommended by some politicians, the raw materials situation could deteriorate.
“If the forests were sold to a private investor or foreign institution, this could have a disastrous impact on the regularity of log supply, which is crucial for the survival of the industry,” he said.
