Dell Inc. reported on Thursday that its global
net income fell 47% for its fiscal third quarter ended November 2, while revenue
fell 11%. Given the concern in early 2009 about the closure of the
Limerick plant where 1,900 were employed and additional employment was generated
in supplier firms, it may seem surprising that the company remains Ireland's
biggest manufacturing exporter.
On the global results, Dell said it expects
another fall in revenue and profits for the current quarter.
"The market's a lot different than anyone
expected coming into the year," Dell's chief financial officer, Brian Gladden,
said in an interview.
Revenue from PCs, which still account for about
half of Dell's sales, plunged 19% from a year ago to $6.6bn. The biggest decline
was in sales to consumers, which fell 23% to $2.5bn.
Dell Ireland has over 2,000 on the payrolls of
its Irish companies now compared with 4,300 in 2006. Dell Products Ireland employs about
1,000 staff (possibly most of them outside Irelans) and the rest are in support services.
Dell Products reported that pre-tax profits fell
from $12.6m to $6.1m in the year to the end of February 2012. But sales
revenues rose by 5%, from $12.3bn to $13bn (€9.7bn). So the taxable profit on the big
revenue figure was miniscule.
The Irish Times Top
1,000 companies, Dell Products is the fifth biggest by sales and it's the
No. 1 for manufacturing revenues.
How could Dell be booking revenues of
€9.7bn in manufacturing sales after closing its Limerick factory?
Dell transferred PC assembly from Limerick to its
new plant in Lodz, Poland in 2008/09. The company had planned to sell the Polish plant to
Foxconn of Taiwan, the electronics contractor. However that did not
Dell Products Ireland books the output of the
Polish factory as a cost of sale and its revenues come from sales to third-party
distributors in the EMEA (Europe, Middle East and Africa) region.
The number of staff on the payroll as per the
accounts does not indicate how many are based overseas.
So when good headline export figures do not
impact the domestic economy, there are several reasons why.
That issue is explored
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