Afilias’s Irish profits dip as it moves base back to the US

Internet domain manager Afilias recorded a fall in profit in the last full year its headquarters were based in Ireland, recently filed accounts show.

Profit before tax at the US-founded company dipped 7 per cent as a result of a drop in profit on available-for-sale financial assets, the company said.

Its revenue, however, improved by more than 6 per cent to $113.6 million after it acquired the UK-based Internet Computer Bureau for more than $70 million.

Afilias, which manages hundreds of millions of internet addresses, was the first known company to relocate to the US on the back of "favourable" tax changes introduced by US president Donald Trump last December.

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The Trump administration cut the corporate tax rate from 35 per cent to 21 per cent, prompting speculation that it would impact on foreign direct investment by US companies.

Afilias plc in Ireland is now a wholly-owned subsidiary of the US-headquartered corporate entity, located in Pennsylvania.

Afilias is one if the internet’s first registrars, managing a number of top-level domains including .info, .mobi, .org, .xxx., .global, .sex, .aero and .rich, along with country domains such as .IN (India) and .AU (Australia).

The recently-filed accounts for 2017 reveal the cost of bidding for these domains, with the company successfully winning one auction held by the Internet Corporation for Assigned Names and Numbers (ICANN), but failing to secure another. Having lost that auction, Afilias was compensated $1.9 million.

The company’s Irish arm employed 279 people last year, down seven on the previous year. Wage and salary costs, meanwhile, increased almost 23 per cent to $28.8 million.

Relocation

At the time of its relocation to the US, Afilias said it did not expect any personnel changes to arise from the decision.

Afilias originally set up its Dublin office almost two decades ago, establishing in the IFSC.It set up in the Republic primarily because of the anticipated appeal of .info, its first product in Europe, the makeup of its initial owner and what it termed "other financial conditions". The company expects to remain profitable here, a directors' note said.

“In 2018 the group is expected to realise a decrease in revenues due to the renegotiation of certain registry service provider contracts, and to generate a profit for the year,” the accounts state.