Pharmaceutical firm blames inflation as profits fall

Norbrook, the Newry-based pharmaceutical firm, says inflationary pressure saw profits fall by 21% to £21.3m last year.

Chief executive Liam Nagle said costs of chemicals were up by 10% to 15% with packaging and shipping prices also rising.

The business was less exposed to energy costs due to buying fixed price contracts.

Turnover was up marginally to £232m.

Norbrook produces veterinary medicines and is one of Northern Ireland’s biggest exporters.

It employs just under 2,000 people, of whom 1,600 work in Newry.

Mr Nagle said staff had received a 5% pay increase in August 2021 and a further 6% in April 2022 as well as a £500 cost of living payment in November.

He said he was optimistic on turnover growth in the coming year but that inflation remained a concern.

Meanwhile, the business is to open a testing lab across the border in County Monaghan.

Norbrook already has a manufacturing facility and the lab is being added as a risk management exercise in light of the ongoing uncertainty around Brexit and the Northern Ireland protocol.

The UK government is currently progressing legislation that would radically change the operation of the protocol.

Part of that is a “dual-regulatory regime” that would mean goods made to either EU or UK standard could be sold in Northern Ireland.

Some companies, particularly in the food sector, have already raised concerns that would create confusion or ambiguity about whether their goods were being produced to EU standards and if they could access the single market.