Wood wind – How Coillte’s boss plans to conduct agency’s renewables rebirth
The chief of the State-owned organisation has wielded the axe and cut 200 posts since taking control in 2015, now he’s out to confound Brexit fears and boost Government coffers by up to €40m, writes Colm Kelpie still pay a decent dividend.
“It might be a little lower than you’d want it, but in the good years you pay a little bit more. It’s within a range.”
And so to the future.
“If we get this right, and we continue in the journey we’re on, you’ll have an organisation that is the best forestry land solutions company in Europe,” Leamy says.
“It has that potential. We have some very strong assets in this country.”
One future income stream is renewable energy. Coillte has just appointed financial advisers IBI and Capricorn to help the agency seek out a joint venture partner to help it manage its renewable energy ambitions.
Between now and the end of the year, their task will be to work with Coillte and figure out what is the right plan for that side of the business.
The commercial semi-State has identified around 1,000 megawatts of development for wind and renewable energy projects on its land. But it believes that to press ahead on its own would take considerable equity and “unbalance” the business.
“My primary aim and the aim of our board is to have a situation where we’re not giving away the family jewels,” Leamy said. “We’re retaining the upside on the wind side but we’re not taking the risk. That is the objective, and I think we’re in a position with the sites we have that we can achieve that.
“We could have taken the decision to do this ourselves, but it would have been such a distraction. You would have had to think about the two parts of the business separately.”
Longer term, the agency doesn’t see itself as a utility company, Leamy says, but more a developer of wind assets – a view that is shared by the board, he adds.
“To do otherwise you would lose focus on forestry and it may well be something for a shareholder in a future point to look at.
“But from Coillte’s perspective, it probably would be the wrong thing for us to do because we would get distracted by it.”
For Leamy, the focus is to put Coillte on a sound financial footing – of particular importance given the threat from Brexit.
He is upbeat about the agency’s prospects for dealing with the UK’s EU withdrawal.
But he accepts there nonetheless remain considerable challenges for which the company needs to prepare.
“There are 40,000 trucks that move between Ireland and mainland UK every year with timber products on them,” he says.
“That’s 150 to 200 trucks a day. That’s not including what goes north and south. The sheer volume here is extraordinary.
“So it’s making sure of simple things – like our IT systems can process documents that might need to cross the Border. We’re doing a lot of that prep work at the minute.”
I wrongly suggest that delays for timber products at borders may not be quite as problematic as those for food products.
But Mr Leamy says time is paramount as customers in the UK regard Coillte almost as a British company.
“For us to support that, the slickness of the system is extraordinary. Material leaves our factories in Waterford and Clonmel and all of our customer factories across the country and is sometimes on-site 48 hours later – 24 hours later when it needs to be.
“We are looking at things like warehousing in the UK. It’s a different challenge to food because of their perishability. But if a B&Q in the UK begins to see us as non-homegrown and they favour the homegrown, then that is a challenge. We’re actually investing more in making us as much a UK-based company in that segment as possible.”
And what of his own plans?
The Waterford man and father of three has had an eclectic background that has included a stint as a ministerial adviser under Simon Coveney, some time in private equity at
Terra Firma Capital Partners and three years in Australia as CEO of agrifood business Consolidated Pastoral after spending four years in the US as head of Greencore US.
“I’ve spent 15 years travelling and I’m thoroughly enjoying my time in Coillte. It’s always for me about coming in and leading that transformation, and we’re not done yet.” ‘There are 40,000 trucks that move between Ireland and mainland UK every year with timber products on them’
Coillte chief Fergal Leamy says there is plenty more to be done to transform the agency despite recent progress