The Irish arm of international music giant Sony Music Entertainment has suffered a 50% year-on-year drop in pre-tax profits.
Against the background of dwindling CD sales in the music industry, accounts for Sony BMG Music Entertainment (Ireland) show the company's pre-tax profits fell from €4.28m in 2006 to €2.11m last year.
Last year, sound recording sales across the industry in Ireland dropped to €102m from €146m in 2001 as a result of illegal downloading and other factors.
In the accounts recently returned to the Companies Office, Sony BMG Music Entertainment (Ireland) Ltd sustained a 21% loss in turnover from €26.17m in 2006 to €20.68m last year.
The principal activity of the Dublin-based company is the marketing and sales of CDs, DVDs and videos in Ireland.
According to the directors' report attached to the accounts, they are satisfied with the performance of the company for the year “in view of the performance of the European operations”.
Some of the subsidiary's Irish artists include Westlife, Christy Moore and The Chieftains.
According to the directors' report, the principal risks and uncertainties facing the company are similar to those facing other companies in the sector.
They include the changing marketplace for the company's products, credit risk from the company's debtors and revenue risk from other competing businesses.