Dermot Corrigan

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Archive for August, 2008

Investment pays off for Dublin Port

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Sunday Business Post – Done Deal Page – 17 Aug 2008

Operating profits at Dublin Port Company rose by 7 per cent last year to total €28.5 million.

The company’s trading results for 2007, released last week, also showed a 6 per cent increase in turnover at €70.5 million. Goods passing through the port for the period totalled 30.9 million tonnes, up 6 per cent on the previous year.

Michael Sheary, company secretary and chief financial officer of Dublin Port Company, said the results marked the company’s 15th consecutive year of growth.

‘‘Over five years, we have invested a lot in new technologies, improving the way we do things and our systems and work practices,” Sheary said.

‘That has all borne fruit.” Dublin Port Company is a private l imited company wholly owned by the Irish state. Established in 1997, it employs 193 staff and handles over two thirds of container trade to and from Ireland, including 50 per cent of all Ireland’s imports and exports.

Additional financial figures released for the first six months of this year show a 3.8 per cent jump in turnover and a 0.3 per cent growth in passenger figures. However, total throughput at the port to the end of June was down 0.9 per cent.

‘‘The volumes coming through Dublin Port in the first half of 2008 are holding up very strongly amid all the doom and gloom,’’ Sheary said.

Cost-cutting initiatives have seen the port cut its wage bill significantly to total €13 million last year, a drop of 1.1 per cent over 2006 – and 33 per cent compared to 2001.

‘‘We have introduced an extensive change management programme over the last five years,” he said. ‘‘We looked at how we do things, the technology we use, and improving how we deliver our services to our customer. That has led to the reduction in payroll costs.”
Boosting last year’s profits was the €109 million sale of the former Irish Glass Bottle site in Ringsend.

‘‘About €30 million of the proceeds was paid over to our pension fund, €30 million paid off our borrowings, and the balance was used to finance our ongoing capital programme,” Sheary said.

The company invested €42 million in several projects, including a new service station, and upgrades to existing terminals, berths and road infrastructure as well as new pilot and tug boats. It has earmarked another €30 million to invest in further upgrade work this year.

Although container throughput accounts for 80 per cent of the company’s turnover, Sheary said passenger traffic was another important source of income.

‘‘We carried 1.4 million ferry passengers last year after a very successful ferry marketing campaign,” he said. ‘‘This year, we expect to have 80 cruise line visits, bringing 60,000 high spend customers into Dublin.”

Written by dermot

August 17th, 2008 at 1:36 pm

Posted in Business

PAC sells plastic card division to US firm

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Sunday Business Post – Done Deal Page – 10 Aug 2008

Prime Active Capital (PAC) has agreed a €13.9 million deal to sell its plastic card division to US company CPI Card Group.

The agreement will see the transfer of PAC subsidiaries, Plastic Card Company and PCC Services, to CPI ownership.

Together, both operations comprise the plastic cards design, production and distribution division of PAC’s Digimedia business.

CPI has agreed to take on existing debts for both operations, resulting in a net sale price of €11.3 million after advisers’ costs, taxes and transaction fees.

PAC chief executive Peter Lynch said the deal was the logical next step in the development of the company’s card production business.

‘‘In order for PCC to grow it would need to move factory, invest in new machinery, get new products and go after new customers such as Visa or Amex,” said Lynch. ‘‘In order to qualify to provide that kind of product you really have to have superb security and facilities and we would have to start again.”

The disposal of its plastic cards units will allow PAC to focus on other areas of its business, Lynch said.

‘‘We decided to sell out in order to change out the business into other areas where we thought we could get value and growth,” he said. ‘‘Once we decided to sell, it was a question of finding the best buyer.”

The sale is subject to shareholder approval, with a confirmation vote scheduled for PAC’s agm on August 28.

PAC’s three directors – executive chairman Peter Lynch, John Doris and Anne Keogh – are all in favour of the deal.

‘‘It is selling at eight times profit before tax, which is ten or eleven times profit after tax,” Lynch said. ‘‘That has to be regarded as a pretty good price.”

PAC’s other businesses include book, journal and on-demand digital printing unit PAC Digimedia and telecommunications division PAC Telemedia, which owns a majority stake in US-based mobile phone retail chain Cellular Centre LLC. PAC also holds a 21.5 per cent share in Media Square, a marketing services group based in Britain.

PAC developed out of printing group Oakhill, led by Ray McLoughlin. Lynch took over as chief executive of PAC in April of last year. The company subsequently relaunched as a buy-out investment vehicle.

‘‘We have experience of investment, and we have experience of running businesses through a private equity situation,” said Lynch.

‘‘We are a hybrid between a management company and a private equity situation. We raised approximately €15 million last year and we have invested most of that in Media Square and Cellular Centre.”

PAC’s group of companies turned over a total of €34.6million in 2007, including €21.4 million from the PAC companies sold to CPI.

Lynch said he expected PAC’s US operations to grow significantly over the next few years. ‘‘The Cellular Centre business has gone from turning over nothing last year to turning over just short of a million dollars a month,” he said. ‘‘It is in a growth phase in a colossal market and we expect it to get up to around $20 million next year.”

Written by dermot

August 13th, 2008 at 8:03 pm

Posted in Business,Technology