Business Irish

Saturday 25 November 2017

Shareholders in quandary as firm loses Midas touch


John Mulligan

John Mulligan

No matter what sheen Michael McNicholas tried to put on it yesterday, little could be done to disguise what can only be classed as a shocking set of results.

In the past decade, most of it under the stewardship of former chief executive Jim Barry, NTR could do little wrong. Its investments in wind energy firm Airtricity and gamble on the West Link paid off handsomely.

And while the NTR train may not have come off the rails since then, it's certainly been shunted to the sidings.

In 2008, with cash burning a hole in the corporate trousers, Mr Barry took a punt on solar energy -- not a necessarily unwise thing to do in an era of soaring oil prices.

But he and his team also took a big gamble on technology, plumping for a niche alternative to traditional photovoltaic cells -- the type most people would be familiar with.

On the face of it, it was a gamble worth taking. But New Mexico-based Stirling Energy Systems has, for now at least, proved nothing more than a black hole for shareholders' cash. Some day it may have its second coming, but believers may have a long wait.

A former ESB senior executive, Mr McNicholas built up a strong reputation as a restructuring expert within the semi-state. He joined NTR early last year, becoming chief executive in June. Costs have been cut in the past year, but he has plenty left to do.

As stark as the bottom-line figure for the last financial year is though, it's not all bad news. Group earnings before interest, tax, depreciation and amortisation (EBITDA) -- and those impairments -- rose from €4.9m to €18.7m, while the US Greenstar business doubled its EBITDA.


The stake in Green Plains Renewable Energy -- the fourth-largest producer of ethanol in the US -- has proved a useful cash generator for NTR. Its controlling stake in Wind Capital is also likely to begin showing strong dividends in the next couple of years.

Still, shareholders must be left scratching their heads as to what has happened to the company. Only three years ago it gave them a €252m cash bonanza as it returned part of its newly found treasure trove. That redemption valued the shares at €6.65 apiece.

Smaller shareholders now have to muddle by with illiquid shares trading -- when they do trade -- at just 55c apiece, with the dividends having been suspended.

They'll be hoping this is the nadir and that NTR will shine once again.

Irish Independent

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