Profits surge to $792m at Limerick-based Analog Devices

Analog Devices chief executive Vincent Roche

PRE-TAX profits for Limerick-based semiconductor manufacturer Analog Devices last year surged by 72 per cent to $792.94million (€726.35m).

New accounts show that Analog Devices International UC, based in Raheen, County Limerick, recorded the increase in profits after revenues rose by 24 per cent – or $1.48billion, rising from $6.23bn to $7.72bn – in the 12 months to the end of October 29 last.

In May, the firm announced plans to build a €630m ($685m) facility in County Limerick, adding 600 jobs to its Irish workforce.

The investment at its European regional headquarters in the Raheen Business Park involves the construction of a 45,000 square foot research, development, and manufacturing facility.

Referring to the Limerick campus investment, directors in their report state that it is “a reflection of Analog Devices Inc’s continued commitment to expansion in Europe”.

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In another post balance sheet event, the directors state that dividends of $1.55bn were proposed and $1.05bn of this balance was paid to connected firm Analog Devices Limerick Unlimited Company.

The directors state that the firm’s gross profits increased by $1.2bn to $5bn last year “primarily as a result of favourable product mix and higher factory utilisation due to increased customer demand”.

They state that this increase was offset by an impairment in acquired financial assets of $613.7m, increased distribution costs linked to higher customer demand of $145.1m and higher inter-company recharges.

The profit also takes account of non-cash amortisation costs of $2bn.

The company recorded post tax profits of $582.5m after paying corporation tax of $210.43m.

Sounding an upbeat note, the directors state that “the demand for our solutions will be unprecedented as technological innovation underpinned by ubiquitous sensing, hyper-scale and edge computing, and pervasive connectivity continues to grow at an exponential pace”.

They state that “our diversified business model combined with our leading technology portfolio position the company to deliver sustainable long-term growth in the years ahead”.

The directors added that the company has a purpose-built European Research and Development Building at their Limerick campus and the R&D spend last year totalled $757.88m compared to $769.9m during 2021.

During the year, the firm paid out dividends of $783.94m.

Numbers employed by the company last year increased from 1,334 to 1,435, made up of 684 in manufacturing, 459 in engineering, 236 in marketing, and 56 in administration.

Staff costs rose from €171.93m to €186.07m and the pay includes share-based payments of $10.65m.

Directors’ pay totalled  $2.192m made up of emoluments of $1.2m, €504,000 in share option gains, €448,000 on long-term incentive scheme, and €36,000 in pension contributions.

At the end of December, the firm had shareholder funds of $31.38bn after benefiting from a capital contribution of $19.88bn during the year.

The company’s cash funds increased from $195.3m to $392.73m.