Belfast Telegraph

Profits at O'Neills soar despite firm's warning over Brexit

By John Mulgrew

Sportswear giant O'Neills has seen its pre-tax profits rise by more than one-third to almost £1.3m, but it has warned that Brexit is a "considerable risk to further development".

The company, which is best known for producing GAA tops and has its Northern Ireland base in Strabane, Co Tyrone, also saw its gross profit rising from £4.4m to £5.4m in the space of a year.

The company has also grown its workforce from 426 to 499, according to accounts for O'Neills Irish International Sports Company Ltd, for the year ending December 2016.

Last year, the firm said it was putting a planned expansion on hold until its gets clarity over what Brexit will mean for its business.

O'Neills, which also operates out of Dublin, had said that it was putting investment in its manufacturing base in Strabane on hold.

In a strategic report in its latest accounts, the firm said that "operating profit increased during the year, primarily due to a general increase in retail sales".

It said: "This can be attributed to improved consumer spending, as the confidence returns to the UK and worldwide economies, together with an increase in internet-based sales."

But speaking about the potential impact of Brexit, the firm said: "Although the growth in the UK and worldwide economies strengthened in 2016, the impending exit of the UK from the EU, and the associated uncertainty is a considerable risk to further development.

"The company aims to remain competitive in the market by reviewing component costs, pricing, and profit profile."

Associated with the GAA since it was set up on Dublin's Capel Street in 1918, the group operates two manufacturing plants - one in Strabane and the other at Walkinstown Avenue in Dublin

Aside from its range of GAA tops, O'Neills produce sportswear for a variety of different sports.

The company now makes cricket clothing, including the kit worn by the Ireland team.

As a result of the increase in the size of its workforce, the company's pay bill increased from £7.9m to £9.4m for the year ending December 2016.

Speaking to the BBC in May about what impact the UK's exit from the EU could have on business, managing director Kieran Kennedy said: "We are in a state of limbo and we don't know what is happening.

"It could have a major effect on our businesses, in part with our employees in terms of free travel from Donegal, where 50% of our staff are employed.

"We are not sure about tariffs and duties, and things like that. And no one can tell us that," the director added.

"That's our biggest fear - 95% of the garments produced in Strabane are exported over the border and further afield.

"If we don't have the same demand, it certainly will have an impact on jobs. We have to wait to find out what is happening before we put our major expansion plans in progress."

O'Neills did not comment when contacted for further response.

A number of companies have already issued warnings over the impact Brexit could have on business. Pharmaceutical firm Almac has said its decision to open in the Republic was a result of Brexit.

Belfast Telegraph

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