Covid restrictions hit Donegal Investment Group revenues

Revenues fell by 8 per cent to €26.1 million at Donegal Investment Group last year as Covid restrictions hit demand for seed potatoes.

Formerly Donegal Creameries, the group which last month completed the sale of its specialist dairy business Nomadic, said pretax profits slipped to €1.62 million from €1.69 million.

However, the company said profit after tax from continuing operations in its fiscal year to the end of August was €900,000 stronger than the previous year at €1.9 million.

Chairman Geoffrey Vance said the board was pleased with the performance of the seed potato business in a very challenging trading environment.

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“Whilst volumes and pricing in seed potato markets remained under pressure as a result of Covid-19 restrictions on the food service industry, our seed potato business delivered a resilient performance with operating profits being maintained close to prior year levels,” he said.

He said the group was “cautiously optimistic” about the trading performance of the seed potato business for the 2021/22 season.

“The group will continue to review all strategic options available in order to maximise shareholder value,” Mr Vance said.

Nomadic

Specialist food investment group BiaVest partnered with Development Capital to acquire Nomadic for an up-front consideration of €23 million. A further €6 million in deferred consideration will be payable depending on Nomadic’s 2022 financial performance.

In addition to the sale of Nomadic, other non-core asset disposals by Donegal Investment took place last year, including the sale of a number of property holdings which, in aggregate, generated net proceeds of €1.8 million.

The group returned €10 million to shareholders earlier this year after redemption of 799,223 shares.

Donegal Investments said it had a cash position, net of debt, of €3.7 million at the end of August. This compares to a €13.2 million net position a year earlier.