Topaz fuel group returns to profit

IRISH-OWNED fuel group Topaz returned to the black last year in spite of a 7 per cent decline in fuel volumes.

Accounts provided to The Irish Timesshow Topaz energy Group Ltd made an operating profit of €21 million and an after-tax surplus of €5.9 million in the year to the end of March 2010.

This compared with an operating loss of €483,000 and an after-tax deficit of €18.9 million in 2009.

Topaz’s earnings before interest, tax, depreciation and amortisation rose by 21 per cent last year to €38.7 million.

But its turnover declined to €2.35 billion last year from €3 billion in the previous 12 months.

This was a 21 per cent reduction, even though the volume of fuel sold only fell by 7 per cent.

The discrepancy is due to more than 60 per cent of fuel revenues here going to the exchequer in excise duties and taxes.

Topaz is backed by Dublin-based Ion Equity, businessman Denis O’Brien and hotelier and property developer Gerry Barrett.

The brand was created in 2008 following the merger of the Shell and Statoil forecourt operations.

A number of factors fed into Topaz’s improved performance.

It reduced its operating costs by 14 per cent to €103.6 million while non-fuel earnings grew by 26 per cent due to increased productivity and a reduction in waste.

Its interest bill was reduced by 28 per cent to €13.7 million.

Topaz closed the year with net debt of €169 million, which is held by Anglo Irish Bank.

Chief executive Eddie O’Brien said its loan is “performing” and Topaz will make a capital repayment this year of €12 million.

“Right now the business is worth more than its debt,” Mr O’Brien said.

Topaz last year acquired a 50 per cent share in Shell Aviation, bought Leinster Petroleum and added 12 sites to its network.

Mr O’Brien said recent price rises were not driven by fuel providers. “Taxes are going up and [global oil] prices are going up. There’s a perception that we’re increasing our margin but our mark up is still 0.6 cent a litre.”