Former Quinn business Mannok posts double-digit profits increase

Mannok posted a 17 per cent increase in EBITDA to €31.1m last year, when it also reduced its net debt by more than €19m
Gary McDonald Business Editor

THE former Sean Quinn-owned border building products and packaging business Mannok was able to post a double-digit profits increase last year despite its sector being largely shackled by lockdown restrictions.

Mannok Holdings, formerly Quinn Industrial Holdings, in an an overview of its 2020 operating performance saw its EBITDA (earnings before interest, tax, depreciation & amortisation) jump by 17 per cent from €26.6m (£23m) to €31.1m (28.7m).

It came on flat revenues of €233m (£201m), which the company says shows a strong resilience to the impact of Covid 19 on trading.

The business, which employs 830 people across operations in Fermanagh and Cavan rebranded as Mannok in September, the culmination of a six-year €60 million (£54m) programme to transform the company bought from Sean Quinn's former business group.

The new name derives from Fear Manach, the Irish for Fermanagh, sometimes translated as men of the country of the lakes.

Mannok reported improved sales and margin increases across cement and packaging, partly offset by higher raw material costs for Insulation products.

Notably, cash generation from operating activities improved by more than 44 per cent from €21.7m (£18.7m) to €31.3m (£27m), which let to a reduction in net debt of €19.4m (£16.7m).

During the year it invested €6.7m (£5.8m), primarily in manufacturing technology and capacity enhancement, bringing total investment to €66m (£57m) since the acquisition of the businesses in December 2014, with a further €6.1m (£5.3m) of investment already in train for 2021.

Chief executive Liam McCaffrey said: “As an organisation with operations on both sides of the border, we are enormously grateful for the support and commitment of our 800-plus colleagues in helping to navigate the twin challenges of Covid 19 and the Brexit transition.

“Careful resource planning and operational agility, facilitated by the significant investment we have made in our sales support, logistics and customs management infrastructure, have ensured uninterrupted supply chains for our customers across the construction and food industries on the island of Ireland and in Great Britain.”

He added: “Post the initial lockdown, trading recovered strongly in the second half of the year, supported by approximately €66m of new investment over the past six years.

“While the business has experienced some impact on trading activities over recent months, with a number of customer projects being delayed as a result of Covid, underlying demand has remained strong.

“Given our ongoing exposure to the food and construction sectors, the very positive response to our rebranding and the potential tail-wind of a vaccine-driven economic recovery, the outlook for 2021 is positive.”

Mannok's two key divisions, building products and packaging, and its key activities are the manufacture of cement, concrete, quarry, insulation materials and products, as well as the manufacturing of packaging products, mainly for the food industry.

But the firm's chief financial officer Dara O'Reilly cautioned: “We continue to monitor markets very closely as well as the supply of key input materials for our insulation and packaging businesses in particular, but notwithstanding a positive outlook and good demand, we are expecting some margin compression this year as a result of inflationary cost pressures.”

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