Monday 23 April 2018

Debt-hit NTR records loss of €381m in just 12 months


John Mulligan

Utilities group NTR racked up a total loss of €381m for the financial year ended last March, marking one of the largest full-year losses in Irish corporate history outside the banking sector.

The group, which owns the Greenstar recycling business and stakes in US alternative energy firms, suffered heavily as it wrote down the value of some of its subsidiaries. The loss is nearly €100m more than recorded in the 2010 fiscal year and brings its accumulated losses over the past three financial years to €712m.

Releasing results yesterday, NTR said it had now written off its entire €190m investment in US-based solar firm Stirling Energy; while last year it wrote down the value of its Greenstar operation by €62.2m.

Almost all of that latter impairment relates to the unit's Irish activities. NTR also operates a Greenstar recycling business in the US.

While the impairments are non-cash charges on NTR's books, it means that investments made in previous years are now considered either worthless or significantly less than their face value. NTR first invested in Stirling Energy just four years ago and owns 52pc of the business.

Investors in NTR -- which include beleaguered group One51 with 24pc and its founding members, the Roche family, with 40pc -- are now effectively discounting the entire value of the business.

With shares in NTR trading at 55c on the so-called 'grey market' yesterday, the company has a market capitalisation of just €113.2m. That's just slightly more than the €112.4m the group had in cash on its books at the end of March. However, NTR lists its total assets -- which also include a 31pc stake in bioethanol producer Green Plains Renewable Energy -- as being worth €996.1m.

Toll bridge

Last year's loss -- with €280.2m attributable to its shareholders -- is in stark contrast to NTR's halcyon days towards the end of the last decade. At the time it was sitting on €1.3bn in cash from the sale of the West Link toll bridge in Dublin and its 51pc stake in Airtricity.

NTR chief executive Michael McNicholas -- who took up the post in June -- conceded yesterday that the bottom line figure for the year was bad after what he described as a "challenging period" for the group.

However, he pointed out that revenue for the year from continuing operations also rose 35pc to €329.4m -- primarily due to increases at Greenstar and its wind energy subsidiary in the US, Wind Capital.

Mr McNicholas said that NTR had taken a "prudent view" in shouldering significant impairments last year and believed the group was unlikely to have to incur charges of that scale again.

"The results are what they are," he said. "There'll be no cash draw from the solar business going forward." He maintained that by 2013, when revenues from the wind energy business had ramped up, that NTR would be delivering a much better set of results.

He added that significant costs had also been stripped out of the NTR subsidiaries and that the core company had no debt.

Irish Independent

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