Newry cruise ship fit-out firm MJM Marine has reported a slump in revenues of nearly three-quarters for 2020 as the industry reeled from the impact of Covid-19.
In its company report for 2020, which has been filed at Companies House, the family-run company said it had made 167 staff redundant at the outset of the crisis in early 2020 in order to secure the future of the business.
Pre-tax profit went from £18m to £6.7m. Cost of sales went from just under £91m to just under £19m. Tax on profit went from £2.9m to just under £166,000.
Total payments of £308,831 in statutory redundancy pay were made to those staff who had lost their jobs.
Revenues slumped by 73% from £116.6m to £31.7m, with 95% of sales coming in the first quarter of 2020 before the pandemic had fully hit.
The report said: “Due to the worldwide impact of lockdowns, the company has been forced to scale back operations as numerous contracts were postponed until the restart of the sailing of cruise ships en masse.
“The directors are also aware that both the local and global economy are facing a potential recession and that the marine industry may be slow to return to pre-pandemic levels of activity.“
However, the first quarter of 2020 had been one of the most successful periods in the company’s history with successful marine fit-outs completed around Europe.
The company also carries out interior fit-outs on land.
But following lockdown, most of its contracts for 2020 were postponed, and none had restarted by the end of 2020. However, because the firm had a strong balance sheet, it was able to unwind contractual agreements without difficulty.
The report stated that the company had also availed of rates relief and support of £2.9m under the Coronavirus Job Retention Scheme. It also received a skills growth grant of around £115,300 from economic development agency Invest NI during 2020.
During the year, the average number of staff was 258, compared to 281 a year earlier before the redundancies had been made. Salary and pension costs had fallen from £10.3m to £9.6m.
Of its revenues, UK projects accounted for just under £892,000, Europe for around £718,000 and the rest of the world £30.2m. That compared to revenues for projects in the rest of the world of £112.7m during 2019.
The company said that the outbreak of Covid-19 and the effects of Brexit had created unique challenges in relation to its supply chain.
But its directors said they were “confident that with their continued financial support and considerable expertise in this area, they can continue to operate successfully in the current climate”.
At the end of the financial year, “the company had a strong balance sheet and were in a strong cash position”.
"As such, the directors are confident that the company has adequate resources available to ensure that the company will continue to trade as a going concern for the foreseeable future.”
They said the company had also successfully navigated the NI Protocol and new customs procedures and checks.
There had also been a change in the company’s ultimate ownership post-year end.
In March 2021, a group restructure meant that the majority of share capital in MJM (IOM) Holdings, the parent company of MJM Marine, had been transferred to Rathbane (IOM) Holdings, now the ultimate parent company of MJM Marine.
In 2018, the company carried out refurbishment of cruise ship the Azamara Pursuit while it was stationed in dry dock at Harland & Wolff in Belfast.