Yahoo routes €320m through Irish unit

Revenues at Yahoo’s main unit in Ireland more than trebled last year after it rerouted its European business through this country, but the company still managed to halve its corporation tax bill.

Yahoo’s European and Middle East (EMEA) headquarters, which operates from a site in Dublin’s Point Village, last April became the unit through which most of its European sales flow. It recorded a rise in revenues to €320 million as a result of the restructuring, up from €98 million.

Its profits before tax did not rise in proportion with its sales. They increased by 50 per cent to €3.7 million. The recently filed accounts show its gross profit margin fell from 30 per cent to 12.5 per cent, despite the rise in volumes.

Yahoo EMEA’s tax bill fell from €1.1 million to about €500,000, mainly due to the application of a deferred tax credit.

Staff numbers

The unit is owned by a Dutch Yahoo company, as part of a complicated European structure. The financial statements show that average staff numbers rose from 229 to 293 during the year.

Yahoo also received an IDA jobs grant in 2014 of more than €1.4 million. It does not specify the method for calculating the grant, although it equates to about €24,000 for each additional job in the financial statements.

The capacity of its new €11 million docklands headquarters, opened by Taoiseach Enda Kenny in March this year, is up to 450 staff.

Since moving its European headquarters to Ireland, Yahoo, in common with many of the tech giants, operates under Irish data protection and intellectual property law.

The 2014 financial statements for Yahoo EMEA refer to a lawsuit taken out against it during the year relating to an alleged breach of copyright laws.

Litigation

Records in the High Court in Dublin show an individual, who could not be reached for comment, filed a case against Yahoo EMEA last year.

The company did not confirm if this was the case referred to in the accounts.

No other outstanding cases are listed against Yahoo EMEA in the Irish courts, although the copyright could have been filed abroad.

Yahoo also said it does not comment on its financial performance beyond its group quarterly earnings. In October, these showed sales for the three months to the end of September of more than $1.1 billion, down by about $80 million.