Forbairt-backed business reports strong growth

Irish businesses supported by the State agency Forbairt have reported a strong performance, with sales and employment growth at an all-time high this year.

In its end-of-year statement, Forbairt estimates total sales in these companies rose by more than 8 per cent to £15 billion in the past 12 months. This strong growth supported the creation of up to 14,000 new jobs, the highest level achieved within the indigenous sector in more than 20 years. It forecasts a further growth in 1998 and has agreed up to 500 feasibility studies with client companies already. Forbairt chief executive Mr Dan Flinter said he was confident that Irish companies would be able to repeat the strong sales and jobs performance seen in the past couple of years.

But he warned that a number of issues must be addressed to ensure the continued development of Irish industry, in particular ensuring the availability of skilled workers to meet the needs of the indigenous sector. "It is expected that the high level of demand from industry for technical graduates will be maintained in the short term and there is an onus on Forbairt to work closely with our client companies towards meeting this challenge," he said.

In 1997, Forbairt's client companies made investment commitments worth more than £450 million, mainly aimed at improving competitiveness and boosting sales. Forbairt contributed a further £100 million to support these investments in 130 major investment projects.

Of this, some £22 million was invested as share capital, with a further £46 million in employment and capital grants. Much of these funds are channelled into supporting research and development and assisting firms to increase capacity.

Overall, these companies created 14,124 new jobs, bringing the total number employed by Irish companies to 131,520. Of these, 13,159 were new full-time positions with the remainder being filled by workers on a part-time and temporary basis.

But, despite the strong growth, some 7,823 jobs were lost in the sector over the 12-month period, slightly higher than 7,347 lost in 1996. This translates into a net increase in employment numbers of 5,336 for the year. Forbairt has also focused on providing seed capital and funding for projects in the very early stages of development this year. Since January, it has joined various private sector initiatives to establish six new venture capital funds to provide investment capital of £38 million. Forbairt said yesterday that a substantial portion of these funds have already been taken up by Irish companies.

Mr Flinter said the success of Irish businesses in 1997 reflected some fundamental changes within the sector. "Institutions in Ireland are now recognising the emergence of a new breed of technology-based Irish companies which are becoming increasingly confident and innovative."

These companies were focused on export markets and were willing to take on international partners to develop alliances to support their international expansion, he said, predicting that, over the next three years, Irish technology companies could be achieving annual sales of more than £100 million. According to the review, Forbairt had £155 million under management in 1997.