Profits down at UK subsidiary of Dermot Desmond’s biometrics business

Daon developed and rolled out Verifly vaccine passport app during pandemic

A UK subsidiary of Dermot Desmond’s biometrics company, Daon, generated profits of more than £274,000 (€310,774) after tax last year, down 33 per cent from pre-pandemic 2020 despite a substantial rise in turnover.

The company, which developed and rolled out the Verifly vaccine passport app used by Aer Lingus and other airlines during the pandemic, is controlled by the financier through entities registered in the Cayman Islands and the Isle of Man.

Daon has sold biometrics systems to financial services companies including BNP Paribas, MasterCard and NatWest Group, who use the software to identify customers and authenticate payments. Its technology is already widely used in airports and at borders around the world, winning a contract in 2015 to supply passport kiosks to Dublin Airport Authority.

The 2021 accounts note that the “principal [sic] activities” of the company are to “develop and sell biometric software and services to governments, system integrators and commercial entities to enable them to manage the identities of their citizens, customers and employees”.

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The filings by Daon UK provide some insight into the affairs of the business, which is registered in Ireland as an unlimited company, meaning it is not obliged to file accounts for public scrutiny.

Last year saw Daon UK’s revenues climb almost 70 per cent to more than £7.5 million (€8.5 million) while its costs rose by more than half to £6.4 million (€7.3 million) and administrative expenses topped £854,000 (€968,000).

Exemptions

In a note to the financial statements, the company’s revenue streams are listed as “software licence fees, professional services and support and maintenance”.

Directors of Daon UK were remunerated to the tune of £140,700 (€159,674) last year, up from £126,837 (€143,941) in 2020. The company was owed some £14.3 million (€16.2 million) by debtors at the end of 2021, more than £11 million (€12.5 million) of which was owed by another company in the group.

However, the accounts note that the UK entity has availed of exemptions in accounting rules, which allow non-disclosure of transactions between two or more members of a group, provided the subsidiaries are wholly owned by the same entity.

The company noted in the accounts that its immediate parent undertaking is Daon Technology “a company which is registered in the Isle of Man” and that its ultimate parent company is Daon Holdings, registered in the Cayman Islands.

Mr Desmond, a Swiss resident, is listed in UK company records as being a person with “significant control” over the group, meaning he holds between 75 and 100 per cent of its shares.

Ian Curran

Ian Curran is a Business reporter with The Irish Times