Profits fall at Ecocem due to rising costs

Rising costs left cement-maker Ecocem’s profits trailing at €2.5 million last year despite a boost to sales.

Accounts just filed for Ecocem Materials Ltd show turnover rose 9.4 per cent in 2017 to €79.4 million from €72.6 million the previous year. Pre-tax profit fell 37.5 per cent to €2.5 million last year, from €4 million in 2016.

The accounts show that costs rose almost 12 per cent last year to €76.5 million from €68.6 million, while its interest bill more than doubled to €335,000 from €147,821.

Ecocem makes cement using waste from steel furnaces. According to the company, this system emits far less greenhouse gas than the normal manufacturing process.

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The company has its head offices and a factory in Dublin, as well as businesses in Britain, France and the Netherlands. Steel giant Arcelor Mittal owns 49 per cent of Ecocem's French operation.

Ecocem subsidiary Orcem Americas wants to build a mill in Vallejo on San Francisco Bay in California in the western US, but locals there are challenging the plans on environmental grounds.

Ecocem’s accounts show that it paid more than €1.7 million in fees to several companies linked to its directors, including French-registered Dorinav SARL, controlled by founders Donal and Vivienne O’Riain, which owns options over 295 shares in Ecocem.

Majority shareholders

The O’Riain’s are majority shareholders in Ecocem through a Netherlands-registered company O’Riain Investments BV.

The other companies that shared the fees were Macolep SARL, also French-based, which director Nicolas Musikas owns; another French firm, Sampa SAS, controlled by Patrick Grace; and 3C Project Management, owned by Ken McAvoy. Ecocem paid these companies €1.8 million in 2016.

The company paid key managers a total of €2.33 million last year, slightly up on the €2.3 million they received the previous year.

Ecocem opened a new plant at Dunkerque in northwestern France earlier this year. It also opened a second import terminal in Britain.

Net Assets grew last year to €44.6 million from €43 million.

California attorney general Xavier Becerra recently criticised environmental reports used to support Orcem's application to build a grinding mill in Vallejo. The company says a fresh report due shortly will tackle many of the concerns that the law official raised.