Origo's operating profit plunges 70%

THE DISTRIBUTION arm of the Sisk building group, whose brands include Toshiba entertainment products and Bosch appliances, has warned of tough market conditions this year after its operating profit fell 70 per cent in 2008.

Origo, formerly known as Beaver Distribution, disclosed in accounts lodged with the Companies Office that it incurred a net loss of €627,000 last year after the dividend it paid out to its parent rose to €1.26 million from €1.09 million.

The company has a big exposure to the continuing decline in the property market and related sectors as well as to the decline in consumer spending generally.

The business is part of the Sicon business empire, one the largest privately owned companies in the State.

In addition to its ownership of John Sisk, by far Ireland’s largest construction company, Sicon operates three healthcare units, a property business, a quarry business and other subsidiaries.

Sicon, which achieved a turnover of €1.6 billion in 2007 and €52.1 million in operating profits, is controlled by members of the Sisk business family.

The organisation, originally established in Cork, traces its roots back to 1859.

Origo’s turnover dropped last year to €50.51 million from €65.87 million and operating profit fell to €918,000 from €3.04 million, new filings show. In addition, pretax profit fell to €728,000 from €2.82 million.

In a note filed with the company’s annual accounts, Origo’s directors said they expected conditions to remain “as difficult” this year as they were in 2008. “Origo had a very difficult year in 2008 with turnover falling 23.3 per cent on the back of substantial declines in the Irish retail sector and falling demand for construction-related products,” they said.

“The company continues its focus on maintaining market share, maintaining margin, adding additional leading brands and the tight management of its fixed cost base.”

In addition to distribution rights for Toshiba and Bosch products, Origo holds rights for the Loewe entertainment product range, Viking garden equipment, Blaupunkt car entertainment systems, Stihl chainsaws, and Dremel and Prototip tools.

Profits retained by Origo declined to €12.38 million last year from €13.27 million, according to its balance sheet.

A bank overdraft and loans amounted to €504,312.

The number of staff in the business declined to 79 in 2008 from 90 the previous year.

Origo was established in 1954 as the LMC Company. For years its core activity was the importation and distribution of heavy construction equipment together with ancillary activities.

It expanded after John G Sisk, founding father of the Sisk building company, acquired Bosch tools for his business on a visit to the Cologne hardware show in the mid-1950s.

LMC was later offered the Irish distributorship rights for Bosch power tools. The company became known as Beaver Distribution in the 1960s and was rebranded as Origo in 2006.