Covid puts €20.7m hit in McDonald's Ireland revenues as profits fall by 70% to €6m

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Covid Puts €20.7M Hit In Mcdonald's Ireland Revenues As Profits Fall By 70% To €6M Covid Puts €20.7M Hit In Mcdonald's Ireland Revenues As Profits Fall By 70% To €6M
Pre-tax profits at the Irish arm of fast food giant McDonald's last year tumbled by 70 per cent to €6 million.
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Gordon Deegan

Pre-tax profits at the Irish arm of fast food giant McDonald's last year tumbled by 70 per cent to €6 million.

That is according to new accounts for McDonald’s Restaurants of Ireland Ltd which show that profits declined sharply as Covid-19 resulted in a €20.7 million revenue hit for the company.

The accounts show that revenues decreased by 30 per cent from €69 million to €48.2 million.

During the period, the McDonald's operation here was made up of 93 franchised stores and two owner operated outlets representing no change from 2019.

The company’s operating profits declined by 69 per cent to €6.35 million and a non-cash property impairment of €347,000 contributed to profits reducing further.

The directors state that revenue and profit reduced due to the Covid-19 pandemic which resulted in restricted trading with all outlets shut from March 23rd, 2020 and gradually reopening as lockdown measures eased.

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Despite the sharp drop in profits and revenues for 2020, the directors state that “the company anticipates continued expansion of its operations in the Republic of Ireland”.

Numbers directly employed by McDonald's here last year reduced from 170 to 147 and staff costs declined by 20 per cent from €4.3 million to €3.5 million.

The profit takes account of non-cash depreciation costs of €3.5 million and amortisation costs of €747,000.

The profit also takes account of lease costs of €15 million.

The company recorded post tax profits of €5.53 million after paying corporation tax of €468,000.

At the end of December last, shareholder funds totalled €103.45 million.

The company’s cash funds reduced from €18.9 million to €13.3 million.

The company paid no dividend last year after paying out a dividend of €20 million in 2019.

A spokesman for McDonald’s said on Friday: “2020 was a challenging year for businesses across Ireland. McDonald’s focus throughout was on ensuring the safety of our customers and employees.

He said: “Our business in Ireland remains incredibly strong with our 93 restaurants providing thousands of jobs to the Irish economy.”

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