Saturday 16 December 2017

Doing hard sums: Is Icon's Ciaran Murray really worth three Tommy Breens?

Icon chief executive Ciaran Murray
Icon chief executive Ciaran Murray Newsdesk Newsdesk

Doing hard sums: Is Icon's Ciaran Murray really worth three Tommy Breens?

We really should know a lot more about Ciaran Murray - after all, he was Ireland's top paid chief executive last year, with an €11.3m remuneration deal.

What he's done at Icon since taking over in October 2011 is nothing short of extraordinary. In short, Murray climbed into the hot seat at the Nasdaq-listed but Sandyford-headquartered company after shares collapsed following a quarterly loss.

Since then, Icon - which does research and clinical trials for big pharma - has been tearing up trees.

A combination of smart investments, big contract wins and keeping costs under control has seen the company turbo charge its growth, becoming one of the four major global players in its space.

Murray has drastically increased its size by offering more services to the large drug companies, including big data analysis and sales and marketing consultancy.

The numbers tell their own story. Since 2011, Icon's share price has risen 4.7-fold. That's better than Ryanair and Paddy Power. A €750m company is now worth €3.5bn.

Gross revenues have jumped 67pc from $1.3bn to $2.16bn. Net income or profits are up 11-fold to $239m. Diluted earnings per share have increased from 0.38 cent to 3.97 cent. Since taking over, he's earned about €34.1m.

How does this compare with some of the other big companies?

Is Murray worth, say... three Tommy Breens?

DCC boss Breen has earned around €12.43m at DCC over the same period as Murray's renumeration at Icon. He's almost quadrupled the share price too. Revenues are up 50pc with earnings per share rising 27pc. Breen has made a euro for every €402 in shareholder value created.

Or is Murray worth, say... two Gary McGanns?

Before he left Smurfit, McGann earned €18.3m from 2011 to the end of 2015 during which time he grew the share price five-fold. McGann earned one euro for every €228 in shareholder value created.

Murray's pay to shareholder value creation ratio lags considerably. He's earned a euro for every €80 in value added to Icon.

Save the polar bears! But while you're up, throw another barrel of tar on the fire

One of the biggest issues that the Green Party - now back in the Oireachtas - has always had is to persuade voters that their policies, while worthy, aren't economic stardust.

Generating electricity from wind farms or from thousands of hamsters spinning in wheels is usually trumped by cheaper (albeit shorter-term) alternatives.

It seems the ESB is sailing in a similar boat. The massive semi-state is spending money hand-over-fist to boost renewables, investing in blue-sky technologies and trying to get people driving cute little electric cars.

All very admirable stuff. But when it comes down to its day job of producing electricity, the ESB's 'green' credentials are less impressive.

Last year, it whacked up the amount of electricity produced by filthy coal from 10,596 GWH up to 13,106 GWH. That's a near 24pc hike in full-fat coal. This was down to "prevailing market conditions which continue to favour coal generation, due to the lower fuel cost and demand for affordable electricity."

You can be green, it seems, if it's cheap.

Who is Ireland's richest senator? And do they deserve the free car parking?

While The Senate is a terrific institution... I'd struggle to identify more than two or three of the senators who have been doing such sterling work over the last term.

Even so, the recent publication of the register of members' interest gives an insight into how rich various senators are, and where they invest their money.

Retail magnate Feargal Quinn is by far the wealthiest to have served. He has money in all manner of investment vehicles and funds run by the likes of Seamus Fitzpatrick at Capvest and with big hitters such as Permira, Oaktree and Mount Kellett. There are also stakes in companies like Jurys Inns as well as smaller Irish outfits like Andrew Collins' PrePayPower, Sean Fitzgerald's fintech group Sentenial and Liam Kelly's Nualight.

But there are other Senators with interesting investments. Jim Walsh, who retired in February, listed shares in Kelly Martin's Malin, Feargal Mooney's Hostelworld and the Colm O'Nuallain chaired IRES Reit. There were also investments in some pretty fancy funds run by Carlyle and Tiger Global, as well as an Amsterdam property development scheme.

Senator Michael Mullins ( neither) had shares in Tony O'Reilly's Providence Resources, Premier Oil and Schneider Electric.

Paschal Mooney had shares in the rather dull insurer Aviva but also in the rather more exciting Zambeef, an AIM-listed agribusiness firm active in Zambia run by Limerick man Francis Grogan.

Paul Coghlan had some Kerry Group shares and 11 properties or bits of land spreading from Killarney to Dublin and Galway.

Paddy Burke had shares in Swedish cider distributor Kopparberg. With the likes of telecoms investor Sean Melly and Aer Arann founder Padraig O Ceidigh both running in the upcoming senate elections, next year could throw some light on the wealth of other politically minded entrepreneurs.

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