WHEN ONE51’s embattled chairman, Denis Buckley, called for questions from the floor yesterday at its annual meeting in Dublin’s Conrad Hotel, it appeared for a split second as if the top table might avoid its now annual verbal bashing.
Then, David Nevins, who said €200,000 of his family’s money was invested in the company, put his hand up – and the floodgates opened. By the finish, about an hour later, Buckley must have been wondering why he had decided to stay on for up to another 12 months.
Shareholders had queried this point aloud. Many wanted to know why he was bothering to hang around given the catastrophic destruction of shareholder value over the past four years.
Peter Byrne, who sought election to the board last year without success, said he would be happy if the board didn’t make any more “choices on our behalf”.
He told the meeting he had suggested to the board in advance of the agm that directors’ fees be cut by 50 per cent to reflect the disastrous performance of the company. “They decided to deny us the opportunity to vote on this,” he added.
He cited how six directors of Kerry Group – a company making almost €1 million a day in profit and 150 times bigger than One51 – earn less than the minimum €41,000 paid to One51 non-executive board members.
Ironically, Kerry Group is a significant shareholder in One51.
Earlier, chief executive Alan Walsh gave a long presentation on the state of the business. He didn’t say it outright but the message seemed clear: blame Philip Lynch, the former chief executive.
Walsh highlighted how One51 had spent €362 million between 2006 and 2008 on acquisitions.
He said high prices had been paid for assets that had underperformed and had since incurred large writedowns in value. “There is no quick fix to the predicament that the group faces today,” Walsh said.
“For One51 to move on into the future, it must clean up the mistakes of the past,” he added.
Walsh’s focus on the period up to the end of 2008 might be seen as a move to absolve him of any blame for the disastrous investments by Lynch, given that the current One51 boss only joined the company in July 2009.
However, accountant John McStay highlighted how Walsh’s advisory role in some of those deals had been trumpeted by One51 when he was appointed as chief financial officer in 2009.
McStay said the trading performance had deteriorated significantly from the middle of last year, when Walsh succeeded Lynch. He said the history of the company was being “somewhat skewed” by the board, adding that there had been a “total collapse” in its trading performance over the past year.
“We appointed a CEO [Walsh] that does not have experience of a trading business,” he added, a view echoed by others.
Walsh informed the room that McStay was acting as proxy for Lynch, whose ghost continues to haunt the company.
Unperturbed, McStay asked Buckley whether he was happy with the performance of Walsh and the company. The chairman answered in the affirmative.
One51 recorded a loss of €12.7 million in the first half of this year to go with aggregate losses of €212 million in 2010 and 2011. The share price is just 35 cent now compared with 90 cent a year ago and €5 in 2007.
Some shareholders suggested that the board simply call it a day, wind up the company and distribute whatever funds it generates to shareholders.
Frank Keogh, who has invested €200,000 in the business, told the meeting that when he suggested this to the chairman in a letter earlier this year he was told it was a “vexatious” remark.
“By Christ, you have some cheek,” Keogh roared at the chairman, adding his investment had been “reduced to rubble”.
“We think that winding up is not the thing to do at this time,” Buckley replied sheepishly.
