New accounts for Lufthansa's Irish maintenance and servicing group, Lufthansa Technik Airmotive, reveal that Shannon Aerospace wiped an estimated $9m off the company's pre-tax profits for 2006, reducing them to $11.4m.

The company employs over 1,200 people in Ireland at sites in Dublin and Shannon Airport.

The figures reveal that industrial relations problems at the Shannon Aerospace cost the group around $5.7m while the sale of surplus inventory held by the company resulted in a further loss of $3.3m.

It is likely that this year's figures will also be hit by problems at continuing problems at Shannon Aerospace, which was forced earlier this year to take out a High Court injunction restraining Siptu from ordering members to take industrial action.

The accounts also indicate that costs rose significantly across the group in 2006 with operating expenses increasing by over 20% to $30.6m and a 10% rise in the cost of sales, which exceeded $200m. The group's turnover rose by only 6.6% to $242.7m.