Killian feels the heat after Aryzta takes €1.4bn hit
With more than €1.4bn wiped off the market value of Swiss-Irish baked goods giant Aryzta this week, ceo Owen Killian is - if he wasn't already - looking over his shoulder.
The calamitous slump in Aryzta's share price this week - a decline of about one-third - was precipitated by an unexpected profit warning, and mean Killian's long stint in the hotseat could be coming to an end. It would be a tortuous fall from grace.
The Aryzta boss isn't well known. He rarely gives gives interviews and isn't a regular on the speech-making circuit hard-worn by some business leaders.
If he is well known, it's for pay. Up to two years ago, he was the country's best-paid ceo - making a cool €5.5m in 2014. That's the kind of money that allows a farmer's son from Roscommon to buy a house in the ultimate old-money location of Shrewsbury Road, Dublin, only to launch a massive and expense refurbishment. All told, the final bill for the house was reckoned to be €18m.
Last March, Killian had to endure the public spectacle of being forced to offload €16m worth of shares in Aryzta.
It was a move he said was "triggered by the weakness in the share price impacting the collateral value of the share". He added that being forced to sell was "not indicative of my confidence in or commitment to Aryzta and the achievement of its goals".
The company's shares had fallen over 10pc before he sold the stake, ditched by investors as it reported weak first-half results.
More was to come.
In October, the company announced that it was "withholding" Killian's annual bonus - a cool €877,000, until earnings start growing. Aryzta's earnings before interest, tax, and amortisation (EBITA) declined 5.7pc to €484.8m in the 12 months to the end of July last year, and the company hired former Smurfit Kappa boss Gary McGann (one of the many roles he's had) as chairman to help direct strategy.
For Killian (62), it must feel like the walls are closing in.
It's all a long way from the days of his youth on his parents' farm in, Hazeldene, Drum, in Co Roscommon.
The Roscommon native's father, Peter, was well-known in the west of Ireland in his time.
For years, he was an activist with the National Farmers' Association (NFA), later known as the Irish Farmers' Association.
In NFA newspapers from the 1960s, his name features prominently as a committee member.
Little wonder then, that Owen Killian went on to study Agricultural Science at University College Dublin, before embarking on a career that saw him eventually lead to a career in business.
Aryzta has its foundations in IAWS (Irish Agricultural Wholesale Society), then a relatively small agri group that Killian joined in 1977.
When Philip Lynch became ceo of IAWS in 1983, he quickly identified Killian's talents, appointing him as his personal assistant.
The pivotal change for IAWS came in 1997, when almost a decade after its stock market flotation, IAWS paid €63m for par-baked bread firm Cuisine de France.
That set the group on a strategy that would see it evolve from a firm whose primary business was related to agriculture, to one that was a consumer foods giant.
In 2003, Killian took over from Lynch, having already served as chief operations officer.
In 2008, following a string of acquisitions that had been made by IAWS in the preceding years, the company effectively acquired Swiss baked goods firm Hiestand to create Aryzta. IAWS had bought an initial 22pc stake in Hiestand in 2003.
In 2005, IAWS had acquired the French company Groupe Hubert and, in 2006, US cookie and muffin manufacturer Otis Spunkmeyer. This ensured that when the time came to consummate the deal with Hiestand it was IAWS which was the dominant partner.
IAWS shareholders emerged with 83pc of Aryzta, while all of the executive directors came from IAWS, including Killian, who became Aryzta chief executive.
And Aryzta kept buying.
In 2010 alone, it paid €349m to buy out a 50pc stake in a huge bakery in Ontario, Canada, from doughnut chain Tim Hortons.
That same year, it also paid $990m to buy US firm Fresh Start Bakeries, and $180m to acquire Great Kitchens, a pizza supplier to retailers.
But things have been coming unstuck.
Last Tuesday's profit warning rang alarm bells all over the place. Aryzta said it was slashing its full-year earnings per share (EPS) guidance by about 20pc.
"Having to lower full-year EPS guidance by circa 20pc two months after its previous trading update suggests a business model with material operational headwinds," said Davy Stockbrokers.
Aryzta described its performance in the five months to the end of December as "unexpected and extremely disappointing".
Many shareholders will now be nursing significant paper losses following this week's turmoil, and face uncertainty as to the company's future.
At least some of them won't be looking for pastries on a platter. They'll be looking for a head.