Coillte interested in tourism deals after strong profit growth

Coillte, which yesterday reported a 63 per cent rise in profits, is to hold talks with the Parnell Society and local politicians about a possible tourism development at Avondale House, the birthplace of Charles Stewart Parnell.

The State forestry company, which owns Avondale and the surrounding forest park in Rathdrum in Co Wicklow, is seeking to maximise the return on its assets, such as by facilitating tourism and other commercial developments on its lands.

Fergal Leamy, Coillte’s chief executive, said it is interested in hearing proposals from possible private sector partners for its assets, including Avondale. He said the State company is “not precious” about the type of developments it would consider, such as a hotel, but insisted it wanted “high quality” projects.

Sustainable

“If a [hotel] proposal made sense, then why not,” he said. “But it would need to be sustainable from a financial point of view.”

Coillte is also engaged in talks with other State bodies about creating what Mr Leamy called a “national recreation plan” to facilitate tourism activities on State lands across the country.

Mr Leamy was speaking following the publication of Coillte’s 2015 annual report, its first set of results following a strategic review which has has overseen since his appointment last year.

Total sales across its three divisions – forestry, land solutions and its panel manufacturing business – dipped slightly to €282.9 million. After-tax profits rose, however, from €29.1 million to €47.6 million.

The company dramatically increased its capital expenditure to €83 million, as it invested in its panels business and also in several wind energy joint ventures, although it still cut its net debts.

Although it is focused on selling more of its wood products abroad, exports outside the UK from its panels business dipped 15 per cent as it withdrew from a number of unprofitable contracts with clients in Turkey.

The group's total pension deficit stood at close to €70 million, and the company has committed to a €5 million annual payment for five years to help plug the gap, as part of an agreement with the Pensions Authority.

Operating cashflow

“We are beginning to make progress on our operating cashflow and there will hopefully be more improvement this year,” said Mr Leamy, a former

Greencore

executive who joined Coillte from Guy Hands’s Terra Firma private equity group.

The annual report reveals he received total remuneration of €179,000 last year, after joining the business in April.

Coillte is seeking about 40 redundancies from its Newtownmountkennedy head office in the first phase of a restructuring that could eventually see up to 90 people leave the group, although the number has not been finalised.

Mr Leamy said Coillte remains interested in pursuing more renewable energy projects such as wind farms on its lands, although it preferred to act as developer and not as an operator.