Restructured Renault Ireland turnover falls more than 43%

Turnover at Renault Ireland fell more than 43 per cent last year to €81.9 million as its market share fell and the firm restructured its Irish operations.

According to the latest accounts filed by Renault Ireland Ltd, turnover fell by €62.9 million during the year. However, there was also a significant reduction in cost of sales, down from €122.7 million in 2011 to €63.9 million in 2012. Combined with a fall in distribution costs and administration expenses, it led to a marginal increase in operating profit, from €1.598 million in 2011 to €1.686 million last year.

Exceptional charge
However, a €1.55 million exceptional charge related to restructuring its dealer network, and various interest and financial charges, saw the firm report a loss on operating activities after tax of €442,981. It had net liabilities of €8.56 million at the end of last year.

The directors’ report said action had been taken to reduce the deficit “through cost restructurings and efficiencies within the company”. Among the creditors due within one year was a charge of €13.28 million due to its parent firm.

In relation to the loss reported in 2012, the accounts said: “The current year loss occurred primarily due to the impact of the dealer network restructuring costs.”

The brand now has 26, dealers having added seven new outlets in the last 18 months.

The car firm’s Irish operations are wholly owned by the French parent company after it took back control in 2007 from the Irish distributor, headed by businessman Bill Cullen.

Ranked fifth
Renault was ranked fifth in terms of sales in the Irish new car market last year and third in the light commercial market with market shares of 6.6 per cent and 11.6 per cent respectively. However, that was a decline from the previous year where it held a 9.6 per cent share of the new car market and a 14.6 per cent share of the light commercial market.

Sales figures up to the end of October this year show Renault’s share of the new car market has slipped further, down to 4.42 per cent, pushing them down to 11th place in the market. In 2011 it registered 8,580 new cars, compared with 5,260 last year. By the end of last month it had registered 3,242 new cars.