Profits at an Irish engineering tools group Mincon fell 76 per cent in 2024 during what was described as a “tough year” by group chief executive Joe Purcell.
The group, which makes and services rock-drilling tools for mining companies, made a profit of €1.8 million for the year ended December 31st, 2024, which was down from €7.5 million the year before.
The company closed its subsidiary Mincon Carbide in Sheffield during the year due to “market dynamics”. The property, plant and equipment owned by Mincon Carbide was sold to a third party on January 17th for £1.8 million (€2.2 million).
When the losses from the Mincon Carbide business are stripped out, the company’s results show a profit of €3.4 million, which represents a reduction of 55 per cent.
Earnings before interest, taxes, depreciation, and amortisation from continuing operations were down 24 per cent to €16 million.
Davy analyst Colin Sheridan said 2024 was characterised by a very weak first half “across the industry”, which had carried over from a similarly poor 2023. He said the improvements witnessed in the second half were “a good step towards recovery”.
He added that if that momentum can be maintained, Davy expects “strong growth” in profitability “should be achievable” for the Dublin-listed business in the year ahead.
Mincon generated revenue of €145.9 million in the year, which represented a decrease of 7 per cent. The group cut its headcount by 74 people in the year, employing 530 staff.
Mining revenue decreased by 7 per cent in the year, with contraction across three of the four mining regions. However, the Europe and Middle East region saw mining revenue increase 71 per cent as customers resumed normal ordering patterns.
Construction revenue was flat year-on-year, as the group generated its first year of significant construction revenue in the Asia-Pacific region after two project wins offset a decrease in revenue in the construction markets of North America and Europe.
Waterwell and geothermal revenue decreased by 23 per cent due to a reduction in new building construction in Northern Europe, where geothermal energy is the primary source of heating.
Production volumes in the first half of the year “dropped significantly” due to lower sales, while increased market competition and some price reductions impacted gross margin. However, market conditions improved the second half.
Despite the “tough year”, Mr Purcell said Mincon is seeing “an improved global environment” in the year ahead for all its target markets.
“With the moderation of global interest rates and a general uptick in business confidence, we did see an increase in activity in the second half, which led to a stronger performance, and this improvement has continued into early 2025,” he said.
“Our root and branch review has resulted in the closure of our business in Sheffield. This difficult decision was taken due to cost inflation and a lopsided tariff structure in Europe that meant we could not compete with the products which were manufactured there.
“It should be noted that the closure was not a reflection of the quality and workmanship of the products made at the plant but simply a matter of market dynamics.”
He said the company has “faced and come through the significant challenges” presented to it in 2024.
“We will continue to work on reducing our own cost inputs while our continuous engineering improvement programme for our product range should contribute to reducing the significant operational cost challenges in our chosen markets.”
