Shannon Development Annual Report 2001 Sd02-119

Annual Report 2001 ... priority must go to investment“ in activities based“ on the production, distribution, and use of knowledge and information. SHANNON DEVELOPMENT ANNUAL REPORT 2001 SD02-119

Cuideachta Forbartha Aerfort Neamhchustam na Sionna Teoranta Pn 11234 Shannon Free Airport Development Company Limited Shannon Development – a Brief Profile

Set up in 1959 to promote Shannon International Airport in the post-jet era, Shannon Development is today, Ireland’s only dedicated regional development company. The Company’s brief is to generate industry, tourism and regional development in the wider Shannon area, known as the Shannon Region. This covers an area of some 10,000 square kilometres spanning counties Clare, Limerick, North Tipperary, South Offaly and North Kerry, which collectively have a population of over 407,000.

The mission of Shannon Development is Pioneering Regional Development for the Knowledge Age, and over the past forty years the Company has worked, singularly and with many different ‘partners’ from the statutory, community and private sectors, to develop the region to its full potential. Shannon Development’s primary focus is to identify the critical needs or obstacles to development in the region, and to lead and encourage the identification and development of solutions. The Company strongly communicates its position, and plays a key leadership role, in relation to important regional development issues, such as airport access, transport infrastructure, and broadband connectivity. Its key activities include:

• Developing and strengthening the indigenous industry sector in the Shannon Region, and building up a knowledge age culture through targeted supports for enterprise.

• Continuing to develop and manage the Shannon Free Zone as a world class location for international investment in manufacturing and internationally traded services.

• Developing the Shannon Development Knowledge Network – a network of leading-edge technology business locations with direct linkages to third level educational institutions. The network includes the National Technology Park in Limerick, Kerry Technology Park in Tralee, Tipperary Technology Park in Thurles, Birr Technology Centre in Offaly, and Information Age Park Ennis in Clare.

• Developing new tourism marketing programmes and new tourism products in the Shannon Region, in conjunction with the industry, to proactively respond to the many challenges facing Irish tourism.

•Managing commercial tourism businesses, e.g. castle banquets and day-visitor attractions, through a wholly owned subsidiary company – Shannon Castle Banquets & Heritage.

• Leading and encouraging regional development at urban and rural levels to ensure economic inclusion and balanced spatial development.

CO. OFFALY

GALWAYDUBLIN (SOUTH)

LIMERICK

CORK BIRR CO. CLARE NENAGH

ENNIS Ocean CO. TIPPERARY ✈SHANNON (NORTH) Atlantic

LIMERICK

CO. LIMERICK

CO. KERRY (NORTH)

TRALEE CONTENTS

Company Statement 2

Review of the Year 6

Company Organisation 21

Directors’ Report and Financial Statements 31

Company Offices 67

Shannon Development’s business is regional development. Its mission is: 1 “Pioneering Regional Development for the Knowledge Age.”

In accordance with the terms in paragraph 2(2) and 3 of the Schedule to the Shannon Free Airport Development Company Limited (Amendment) Act 1970, the Company presents the Report and Accounts for the year ended 31st December 2001 to the Tánaiste and Minister for Enterprise, Trade and Employment.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY STATEMENT

2001 was a difficult year for industry and fulfils national needs; operates across a tourism in the Shannon Region but despite range of sectors but in an integrated way; the difficulties there were positive develop- has an asset base that can be used to initi- ments during the year which give confi- ate and deliver complex but innovative dence for the future. Challenging times projects at minimum cost to the taxpayer; generate creative responses. The Shannon and provides a model of regional develop- Region has participated fully in the resur- ment action for the knowledge age. gence of the national economy over recent years, equally, it was not immune to the Shannon Development’s future focus will general slowdown in economic activity in be to identify the critical needs or obstacles 2001. to development, and to lead and encourage the identification and development of The radical change in the economic envi- solutions. This is why we have, in recent ronment which we have witnessed in 2001 times, strongly communicated our position highlights the challenge for Ireland as a in relation to key regional development modern economy and the need for new issues, such as airport access, transport 2 solutions to the issue of regional competi- infrastructure, and broadband connectivity. tiveness. The relative importance of manufacturing activity as a driver of economic Shannon Development places a high prior- growth is reducing. If the economy is to be ity on the creation of an enabling environ- re-invigorated in a way which ensures that ment for entrepreneurs and businesses that all share in the fruits of success, then higher can generate globally competitive and priority must go to investment in activities knowledge based enterprises which gener- based on the production, distribution, and ate significant wealth for shareholders, use of knowledge and information. employees, suppliers, the community and other key stakeholders. That is why the Against this background, Shannon Company has invested significant financial, Development has set out its mission for the physical and human capital in the develop- future as pioneering regional development ment of projects such as the Shannon for the knowledge age. This means that we Development Knowledge Network – world will concentrate on researching, concepting class locations for business and life - linked and pilot testing a range of innovative directly to third level education facilities actions that will generate regional compet- throughout the Shannon Region. itiveness and accelerate economic development. If successful, these actions can be That is why the Company intends to estab- mainstreamed and delivered by others at lish a consortium Shannon Broadband with regional, national and international level, the local authorities in the Region, as a while also making a significant contribu- mechanism to facilitate delivery of world tion to Ireland’s development as a leading class broadband connectivity at competi- player in the globally competitive knowl- tive prices. That is why, in response to the edge based economy. challenges facing the tourism industry, Shannon Development established the This calls for new thinking and new Tourism Action Force, which brings approaches to economic development. The together Shannon Region and West of Shannon Region can make an important Ireland tourism interests, to undertake contribution to this process by becoming a positive actions to increase tourism busi- model for pioneering and testing new ness in 2002. approaches to the development of regional competitiveness. This is the optimal way to position the Shannon Region as a powerhouse for In this way, Shannon Development provides future economic growth. The greatest a regional development laboratory, which results can be achieved by developing a is close to the regional customer base but strong Atlantic economic corridor, stretch-

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY STATEMENT

ing from Cork/Kerry through the Shannon In this context, Shannon Airport is a critical Region to Galway/Sligo. This would lead to part of the infrastructure of the entire west re-energised thinking while also providing coast of Ireland and an engine for its devel- a counterbalance to the explosive growth opment. At a national level, the airport can currently taking place in the greater Dublin play an even greater role in helping to area. The Limerick – Shannon – bring about more balanced regional Ennis gateway is already well developed, growth. Within the context of the vision of and has the potential to grow even further the western cities acting together and pro- and drive additional economic growth viding counter balance to Dublin, Shannon throughout the Shannon region. Acting Airport is strategically situated at the cen- individually, regional centres cannot be a tre of that alliance. For this reason, the serious counterbalance to the critical mass national response to the current difficulties of Dublin but acting together they have the facing the aviation sector must take full potential to rebalance growth towards the cognisance of the strategic role of Shannon Atlantic seaboard. Airport as an instrument of regional development. 3 Shannon Development believes that strategic alliances of this nature, which do not The key to Ireland’s future economic success impact on administrative boundaries, have in the global economy lies in its ability to the potential to generate significant eco- achieve the same success in the knowledge nomic impact and to greatly contribute to economy as it has in the traditional indus- the Government’s commitment to balanced trial economy. regional development.

Drawing on its practical experience of the Liam McElligott development challenge over many years Chairman Shannon Development has actively inputted to government deliberations on Kevin Thompstone the development of the National Spatial Chief Executive Strategy. The Company fully supports the key principles guiding the NSS, including partnership, the interdependence of rural and urban areas, the development of potential, and the building of critical mass.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 RÁITEAS NA CUIDEACHTA

Ba bhliain chrua a bhí sa bhliain 2001 don shamhail do cheannródaíocht agus do tionsclaíocht agus don turasóireacht i thástáil cur chuigí nua i leith fhorbairt an Réigiún na Sionainne ach in ainneoin na iomaíochais réigiúnaigh. ndeacrachtaí tharla forbairtí deimhneacha i rith na bliana a bhí ina gcúis muiníne don Ar an gcaoi seo, soláthraíonn Forbairt na todhchaí. Cruthaíonn amanna dúshlánacha Sionainne saotharlann réigiúnach forbartha freagairtí cruthaitheacha. Bhí Réigiún na , atá gar don bhunáit réigiúnach custaiméirí Sionainne lánpháirteach in athbheochan an ach a chomhlíonann riachtanais náisiúnta; a gheilleagair náisiúnta le blianta beaga oibríonn ar fud raon earnálacha i mbealach anuas, ar an gcaoi chéanna, níor tháinig sé lánpháirtithe; a bhfuil bunáit sócmhainní slán ón moilliú ginearálta i ngníomhaíocht aige is féidir a úsáid chun tionscadail eacnamaíochta sa bhliain 2001. nuálacha ach fós casta a thionscnamh agus a sheachadadh ar chostas íosta don Tugann an t-athrú radacach sa timpeallacht cháiníocóir; agus a sholáthraíonn samhail eacnamaíochta a chonaiceamar i 2001 an de ghníomh réigiúnach forbartha do ré an dúshlán d’Éirinn mar gheilleagar nua- eolais. 4 aoiseach chun suntais, mar aon leis an ngá atá le réitigh nua a fháil ar cheist an Is é an fócas a bheidh ag Forbairt na iomaíochais réigiúnaigh. Tá an tábhacht Sionainne don todhchaí ná riachtanais coibhneasta a bhaineann le gníomhaíocht chriticiúla don fhorbairt nó bacainní uirthi a dhéantúsaíochta mar bhealach chun fás shainaithint, agus ceannas ceann agus eacnamaíochta a bhrú ar aghaidh ag spreagadh a thabhairt maidir le sainaithint laghdú. Má tá beocht le cur sa gheilleagar agus forbairt a dhéanamh ar na réitigh. Sin in athuair ar bhealach a chinntíonn go an chúis, le tamall anuas, gur chuireamar ár mbíonn a sciar féin ag gach duine de seasamh i leith príomhcheisteanna réigiú- thorthaí na rathúlachta, caithfear tosaíocht nacha forbartha trasna go láidir, ceisteanna níos airde a thabhairt d’infheistíocht i mar rochtain ar an aerfort, bonneagar iom- ngníomhaíochtaí a bhíonn bunaithe ar pair agus lúdracht leathanbhanda. tháirgeadh, dáileadh agus úsáid eolais agus faisnéise. Tugann Forbairt na Sionainne tosaíocht ard do chruthú timpeallachta inchumasaithe Leis an gcúlra sin, is é an misean atá leagtha d’fhiontraithe agus do ghnólachtaí ar féidir amach ag Forbairt na Sionainne don tod- leo fiontair atá iomaíoch go domhanda hchaí ná ceannródaíocht a dhéanamh i agus eolasbhunaithe a chruthú a ghineann bhforbairt réigiúnach do ré an eolais. rachmas suntasach do scairshealbhóirí, Ciallaíonn sé sin go ndíreoimid isteach ar d’fhostaithe, do sholáthróirí, don phobal thaighde, ar cheapadh coincheapa agus ar agus do phríomhpháirtithe leasmhara eile. thástáil phíolótach a dhéanamh ar raon Sin an chúis gur infheistigh an Chuideachta gníomhartha nuálacha a chruthóidh caipiteal suntasach airgeadais, fisiciúil agus iomaíochas réigiúnach agus a chuirfidh dlús daonna i bhforbairt thionscadal mar le forbairt eacnamaíochta. Má éiríonn leo, Ghréasán Eolais Fhorbairt na Sionainne – is féidir le daoine eile na gníomhartha sin a suímh den scoth do ghnó agus don saol – phríomhshruthú agus a sheachadadh ag atá nasctha go díreach le saoráidí leibhéal réigiúnach, náisiúnta agus oideachais tríú leibhéal ar fud Réigiún na idirnáisiúnta, agus fós a bheith ag cur go Sionainne. suntasach le forbairt na hÉireann mar cheannródaí i ngeilleagar iomaíoch Sin an chúis gur bhfuil sé beartaithe ag an domhanda a bhíonn bunaithe ar an eolas. gCuideachta feadhnacht Leathanbhanda na Sionainne a bhunú leis na húdaráis Éilíonn sé sin smaointeoireacht nua agus cur áitiúla sa Réigiún, mar mheicníocht chun chuigí nua i leith fhorbairt eacnamaíochta. éascú a dhéanamh ar lúdracht Is féidir le Réigiún na Sionainne cur go mór leathanbhanda den scoth a sheachadadh leis an bpróiseas seo trína bheith mar ag praghsanna iomaíocha. Sin an chúis,

SHANNON DEVELOPMENT ANNUAL REPORT 2001 RÁITEAS NA CUIDEACHTA

mar fhreagairt ar na dúshláin a bhí roimh Sa chomhthéacs sin, is cuid chriticiúil é thionscal na turasóireachta, gur bhunaigh Aerfort na Sionainne de bhonneagar chósta Forbairt na Sionainne an Fórsa thiar na hÉireann ina iomláine agus is Gníomhartha Turasóireachta, a thugann inneall é dá fhorbairt. Ag leibhéal leasanna turasóireachta Réigiún na náisiúnta, is féidir leis an aerfort ról fiú níos Sionainne agus Iarthar na hÉireann le mó a bheith aige i gcabhrú le fás réigiúnach chéile, chun taca a chur faoi ghníomhartha níos cothromaithe a bhaint amach. Laistigh deimhneacha chun cur le gnó na de chomhthéacs na haislinge de chathracha turasóireachta i 2002. an iarthair ag bheith ag gníomhú le chéile agus ag cur cothromú ar fáil le Baile Átha Seo an bealach is fearr chun Réigiún na Cliath, tá Aerfort na Sionainne suite go Sionainne a shuíomh mar bhonn spreagtha straitéiseach ag lár na comhghuaillíochta d’fhás eacnamaíochta sa todhchaí. Is féidir sin. Ar an gcúis sin, caithfidh an fhreagairt na torthaí is fearr a bhaint amach trí náisiúnta ar na deacrachtaí atá roimh an chonair eacnamaíochta láidre Atlantaigh a earnáil eitlíochta i láthair na huaire aird fhorbairt, conair a bheidh ag síneadh ó iomlán a thabhairt ar ról straitéiseach 5 Chorcaigh/Ciarraí trí Réigiún na Sionainne Aerfort na Sionainne mar uirlis d’fhorbairt go dtí Gaillimh/Sligeach. Bheadh smaoin- réigiúnach. teoireacht spleodrach mar thoradh air sin agus fós chuirfí cothromú ar fáil don fhás Luíonn an eochair do rathúlacht eacna- forásach atá ag tarlú faoi láthair i maíochta na hÉireann san eacnamaíocht mórcheantar Bhaile Átha Cliath. Tá bealach dhomhanda amach anseo ina chumas an Luimnigh – na Sionainne – Inis forbartha go rathúlacht chéanna a bhaint amach san eac- maith cheana féin, agus tá an cumas aige namaíocht eolais agus a rinne sé san eacna- fás fiú tuilleadh agus fás breise eacna- maíocht traidisiúnta tionsclaíochta. maíochta a bhrú chun cinn ar fud réigiún na Sionainne. Ní féidir le lárionaid réigiúnacha, ag gníomhú ina n-aonar, a bheith ina gcothromú dáiríre do mhais chriticiúil Bhaile Átha Cliath, agus trína bheith ag gníomhú le chéile tá an acmhainn acu ath- chothromú a dhéanamh ar an bhfás i dtreo imeallbhord an Atlantaigh.

Creideann Forbairt na Sionainne go bfuil an cumas ag comhghuaillíochtaí straitéiseacha den chineál sin, nach mbíonn tionchar acu ar theorainneacha riaracháin, athrú luais a chruthú sa tionchar eacnamaíochta agus cur go mór le tiomantas an Rialtais i leith forbartha réigiúnaí cothromaithe. Liam McElligott Kevin Thompstone Ag tarraingt ar a thaithí praiticiúil de Cathaoirleach Príomhfheidhmeannach dhúshlán na forbartha le go leor blianta tá ionchur gníomhach déanta ag Forbairt na Sionainne i ndíospóireachtaí an rialtais ar fhorbairt Straitéise Spásúla Náisiúnta. Tugann an Chuideachta lántacaíocht do na príomhphrionsabail a threoraíonn an Straitéis Spásúil Náisiúnta, lena n-áirítear comhpháirtíocht, idirspleáchas limistéir tuaithe agus uirbeacha, forbairt na hacmhainne, agus tógáil na maise criticiúla.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

A challenging year for industry downturn in the ICT sector, and the tragic events of September 11th and their impact 2001 was a particularly difficult year for on the aviation sector, by the fact that the industry in the region, in terms of sustain- 126 companies located there operate across ing employment and generating new activ- a diverse range of business sectors and mar- ity. Nevertheless, Shannon Development kets. Exports by Shannon Free Zone based supported companies created 1,810 new companies were valued at over €2 billion in jobs in 2001, of which 683 were created by 2001. companies at the world-renowned Shannon Free Zone and 1,127 by indigenous compa- Indigenous companies faced a separate set nies throughout the region. of challenges and, as many companies are sub-suppliers to multinationals, the slow- Despite this increase, there was an overall down on the multinational side filtered reduction of 3.2% in the numbers down to the indigenous sector. Increased employed in Shannon Development sup- input costs which added competitive pres- ported companies, with employment levels sures in the general manufacturing sector 6 at December 2001 totalling 21,351 (22,049 and, the foot and mouth crisis and BSE, at December 2000). This resulted in a net both of which had a specific effect on the job loss of 698, the first decline in overall food sector, should also be factored in as employment figures since December 1993. impinging on overall business performance. Results from the Annual Business Survey of Economic Impact highlight favourable indi- Despite these setbacks, Shannon cators for Shannon Development assisted Development is optimistic for the future companies. Exports for the Region and is focused on supporting enterprise in increased by 27% between 1999 and 2000. the region to position itself to improve The increase in sales for the companies sur- competitiveness and growth as the global veyed in the Shannon Region was 21%, and economy recovers. the increase in Gross Value Added, a meas- Free Zone Investment. ure of productivity growth, was 15% over Pictured at the opening of a €15 million nitration plant at SIFA the same period. Ltd on the Shannon Free Zone Continuous support for enterprise were (L Ð R) Kevin Thompstone, Shannon Free Zone companies incurred a With 126 companies operating in a wide Chief Executive, Shannon range of manufacturing and international Development, Liam McElligott, less than 1% job loss, almost maintaining Chairman, Shannon their 2000 levels, while the indigenous sec- services sectors, and with exports valued at Development, the Taoiseach, tor was harder hit with a loss of 4.3% on €2 billion (£1.6 billion) at year end, Bertie Ahern TD, and Patrick Shannon Free Zone remains one of the Schwarz-Schutte, Chief the 2000 figures. The Free Zone was cush- Executive, Schwarz Pharma AG. ioned from the severity of the general Shannon Region’s, and Ireland’s, primary investment centres.

Shannon welcomed a number of new companies during 2001. Three new companies – RSA Security Ireland Ltd; Elmdon Ltd; and Tecnium Manufacturing Services Ltd, – set up operations at the Shannon Free Zone during the year, while two new companies – Synergy Board Systems and Advanced MP Technology – received approval to com- mence operations in 2001. In addition, three companies – Tekelek Europe; Nelvana International Ltd and Pacific Network Services – expanded operations on the Zone, while 28 international companies visited Shannon for the first time to assess it as a business location.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

RSA Security Inc, one of the world’s leading providers of security solutions for the communications industry, opened its new European manufacturing facility at Shannon Free Zone in 2001. At the opening were (L Ð R) Gerry Fitzmaurice, Projects Manager, Shannon Free Zone, Art Coviello, President and CEO, RSA Security Inc, and Kevin Thompstone, Chief Executive, Shannon Development.

In further good news for the future, a new Development-promoted ‘World Class one million sq. ft. development of office Business’ programme, designed to intro- and manufacturing space named West Park, duce and implement ‘World Class’ business which will incorporate a major Internet techniques to support the profitable Data Centre, was also announced for growth of participating companies. The Shannon. This is being developed by a pri- take-up on the programme was way ahead vate sector company, Concre Developments of expectation and reflects the willingness Ltd, in association with Shannon of SMEs to identify new approaches to Development. improving their competitiveness.

On the indigenous front, a number of new Feedback from participating companies was approaches were taken to improve the very positive, with a satisfaction rating of competitiveness of this sector. During 2001, over 88%. Improvements of up to 38% fifty small to medium-sized companies were achieved in productivity, waste drasti- (SMEs) participated in a Shannon cally reduced, and marketing and sales

Pictured at one of a series of design workshops, organised by Shannon Development, for companies in the region to highlight the importance of design to both the innovative process and to industry itself were (L Ð R) Billy Wixted, Project Manager, Shannon Development, Jonathan Mangan, CADtec Europe Ltd, John Connelly, Dutex Ltd, and Brian Callanan, Planning and Research manager, Shannon Development.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

strategies developed. Most importantly of ment for the Knowledge Age’. all is the fact that the participating compa- Shannon Development Knowledge nies are now adopting a team approach to Network comprises five world-class technol- problem identification and resolution. ogy locations for business and life, developed specifically to support the To increase the level of usage of development and growth of technology- Information and Communications driven enterprise in the Shannon Region. Technology (ICT) by small to medium-sized The Shannon Development Knowledge enterprises (SMEs) and to ensure that they Network is a direct result of the strong link- regard ICT as a central part of their busi- ages that Shannon Development has and ness, the Company launched an eCluster ini- maintains with the third level institutions of tiative – the first of its kind in Ireland. The this region. newly-developed e-cluster programme will assist companies to create and implement The locations within the network include: an Information Technology improvement National Technology Park Limerick, Kerry plan which will accelerate their use of Technology Park, Tipperary Technology 8 eBusiness as a competitive advantage. This Park, Information Age Park Ennis, and Birr pilot programme will be monitored Technology Centre. Each location is dedi- throughout 2002 and results will be used to cated to providing the resources and envi- guide further initiatives in the e-business ronment in which ideas and arena both in the Shannon Region and knowledge-based businesses are created, nationally. developed and succeed. Each has an InnovationWorks facility – ‘smart’ buildings, incorporating state of the art telecoms, and Creating a network of technology managed facilities specifically focused on locations in the Shannon Region generating new high growth knowledge intensive businesses. A new, dynamic and distinctive product – Shannon Development Knowledge Each location is an ideas dynamo compris- Network – launched during the year will ing Business, Education, and Innovation. greatly assist the Company to deliver its The combination and interaction between mission of ‘pioneering regional develop- these three types of facilities, and the abil-

John O’Donoghue TD, (left) Minister for Arts, Sport and Tourism, launched the Shannon Development Knowledge Network, the new name for the Company’s network of technology locations in the Shannon Region, at the opening of Kerry Technology Park in Tralee in November 2001, pictured with Marie Lynch, Business Development Manager, Kerry Technology Park, and Kevin Thompstone, Chief Executive, Shannon Development.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

ity of each location to network and create Encouraging entrepreneurship at synergies between each other, makes the InnovationWorks Shannon Development Knowledge To guarantee a flow of new technology- Network unique. driven business through the InnvationWorks facilities, a new Significant progress had been made in Entrepreneurship Programme – developing the network by year end: VentureStart – was introduced by the •With €444.4 million (£350 million) Company in 2001, which attracted eighty invested at the National Technology participants. A number of potential entre- Park, Limerick to-date, this is now a well preneurs or venture teams will emerge established technology location, with from this Programme and over the next few over 80 organisations operating there, years will create a number of new enter- occupying a floor area of circa 1.5 million prises. A further series of new programmes sq. ft. and employing approx. 4,000 peo- will also be introduced through 2002. ple. • €9.5 million (£7.5 million) has been 9 invested at Kerry Technology Park which Investment activity in High officially opened in November 2001. Ten Potential Start-up (HPSU) Irish-owned technology driven compa- Companies nies are now located there employing Work also continued on assisting new and 100 people. The first two buildings, com- established companies to develop their prising 40,000 sq. ft. were completed and high-growth businesses through the operational in 2001 and planning per- Company’s investment programme. During mission has been received for the 3rd 2001, the Company invested €1,340,000 building. (£1,055,000) in high potential start-up proj- • €3.8 million (£3 million) was invested in ects throughout the region. Seven new developing the first 20,000 sq. ft. build- ‘high potential start-up’ projects had equity ing at Tipperary Technology Park incor- packages approved amounting to porating a new 5,000 sq. ft. €1,270,000 (£1million). By year end, a total InnovationWorks facility, scheduled to of €418,000 (£329,000) had been realised open in 2002. on exits from five projects. • €3.8 million (£3 million) investment, including €1.5 million (£1.2 million) from the private sector, will result in the com- Developing the optimal business pletion, by late 2002, of Birr Technology environment Centre – a 24,000 sq. ft. technology facil- A number of projects geared specifically to ity, incorporating a 7,000 sq. ft. providing an optimal environment con- InnovationWorks facility. ducive to business and overall economic •The new 35-acre Information Age Park development were underway at year end. Ennis, incorporating 750,000 sq. ft. of high-quality office-type accommodation is being developed on a phased basis over a 10-year period. The potential investment at this location is estimated at €152 million (£120 million) – sourced from the public and private sectors.

The Company places great emphasis on supporting and developing technology-driven enterprises, the root of the region’s economic development and growth.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Broadband to the Region Physical infrastructure The Company considers the rollout of In developing the region’s physical infra- broadband telecommunications infrastruc- structure, in 2001, Shannon Development ture as critical to the development of the invested €11.4 million (£9 million) in the Shannon Region, both in facilitating knowl- provision of infrastructure to aid economic edge age activities and underpinning enter- development throughout the region. This prise development initiatives. level of investment by the Company was instrumental in leveraging an additional During 2001, Shannon Development com- €25 million (£20m) of private sector invest- missioned a comprehensive study of broad- ment in industrial and commercial facilities band infrastructure in the region, along with in the region. a survey of key users, in an attempt to identify gaps and priorities for the region going Major projects undertaken during the year forward. Based on this review, Shannon included: Development set out its telecommunications • Entering a joint venture agreement with priorities for the Shannon Region and com- 10 Concre Developments to undertake a menced a new flagship project aimed at major development of hi-tech offices addressing the digital divide between the and a data centre on a 30 acre site at region and the east coast. West Park, Shannon Free Zone.

The strategy to be implemented by •An agreement with Beauwalk Properties Shannon Broadband – a consortium being to facilitate the major expansion of set up by Shannon Development and the Shannon Town Centre. Region’s local authorities – will include the • Completion of purchase of Our Lady’s following action priorities: Hospital and grounds in Ennis for the •Promoting the rollout of additional development of the new Information national carrier neutral infrastructure to Age Park Ennis, for which planning per- facilitate carriers gaining access to the mission for infrastructural development region. has been received. •Attracting a Global Carrier into the • Completion by private sector partners of region to facilitate direct international a new office development of 15,000 sq. connectivity. ft. beside the Clare Business Centre in Francis Street, Ennis. • Developing a Regional Ducting Backbone to link together all enterprise •High quality advance buildings, built by clusters in the region and help promote the private sector and certified under the competition between operators. BES by Shannon Development, were completed in Ballylanders, Co Limerick This strategy and action plan can serve as a and Kilrush, Co Clare. model for addressing the current gaps in • Completion of two 20,000 sq. ft. units on broadband connectivity outside of Dublin. the new Kerry Technology Park – the sec- Under the National Development Plan, the ond location to open in the Shannon Department of Public Enterprise (DPE) has Development Knowledge Network. made additional funding available to increase and improve the telecommunica- • Commencement of the first 20,000 sq. ft. tions infrastructure nationwide for the at Tipperary Technology Park in Thurles advancement of communication and which formed Phase 1 of the develop- eCommerce and to bring better telecom- ment of the third location within the munications connectivity to the regions. Shannon Development Knowledge Shannon Development, on behalf of Network. Pending completion, in August Shannon Broadband, submitted a funding 2002, an existing 5,000 sq. ft. building on bid to the Department of Public Enterprise the site was transformed to at the end of 2001, for the first strand of its InnovationWorks standard and was oper- broadband action programme. ational at year end.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Regional Initiatives for the Knowledge Age Ð the Shannon Development Knowledge Network is a unique initiative grouping together five key technology locations in the Shannon Region. The five centres, the National Technology Park Limerick, Kerry Technology Park, Tipperary Technology Park, Information Age Park Ennis and Birr Technology Centre, have been teamed in a dynamic move to bring business, education and innovation together. Pictured are new buildings at (left) the Birr Technology Centre, (below left) Kerry Technology Park, and (below right) Tipperary Technology Park. 11

• Contract signed to acquire c.30 acres at National Spatial Strategy Roscrea for development of a new The Government published the indications Business Park. paper for the National Spatial Strategy • Commencement of construction of Birr (NSS) during the year. This was welcomed Technology Centre – the fourth location by Shannon Development in its submission within the Shannon Development to the Department of Environment & Local Knowledge Network. The 24,000 sq. ft. Government. The work on the NSS reflects transformation of an old derelict mill in previous studies by Shannon Development the centre of Birr, incorporates a 7,000 which showed that regional policy was nec- sq. ft. InnovationWorks facility. essary as the spatial dimension of national • Agreement reached with Limerick economic policy. County Council to acquire a 20 acre site at Newcastlewest for the development Shannon Development supports the key of a Business Park. Planning application principles guiding the NSS as being compre- was submitted in September. hensive and inclusive. Key elements such as partnership, the interdependence of rural • Completion of Hamilton House Phase 2, and urban areas, development of potential, at the National Technology Park, the building of critical mass, the approach Limerick, comprising 60,000 sq. ft. of to balanced regional development reflect offices, by Brookvale Ltd. the approaches which the Company has taken to the development challenge in the Shannon Region over the years.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Building on the Company’s long involvement with the National Tidy Towns Competition, in 2001, Shannon Development launched the Limerick Tidy Streets Competition. Pictured at the launch were (L-R) Willie O’Dea TD, Minister for State at the Department of Justice, Equality and Law Reform, Liam McElligott, Chairman, Shannon Development, Dan Wallace, then Minister for State at the Department of the Environment and Local Government, Cllr John Ryan, then Mayor of Limerick, and Kevin Thompstone, Chief Executive, Shannon Development. 12

The Company regards the possibility of the ous research and consultation for regional cities of Cork, Galway, Limerick/Shannon/ innovation, particularly building on the net- Ennis, and Waterford, acting collectively to work of support from the higher education counterbalance Dublin as challenging. institutions and other statutory bodies in While individually, none of these cities can the region. Collaborative efforts to support provide a serious counterbalance to the crit- regional innovation with these institutions ical mass of Dublin, acting together, they are ongoing, and include programmes in have the potential to rebalance the country design, natural resources, research and towards the western seaboard. If the com- technology transfer. plementarities of these areas can be identified and developed then the attractiveness and competitiveness of each is enhanced. Sharing expertise with developing Shannon Development believes that this countries concept needs to be fully explored and Throughout the year, the Company contin- developed and will undertake further work ued its work of assisting developing coun- towards its attainment in 2002. tries and was involved in a number of major international consultancy projects in Slovakia, Hungary, Estonia and Slovenia. Clearly focused on innovation One staff member is currently based full- During the year, Shannon Development time in the Czech Republic within the published the Action Report on the Ministry of the Economy advising on the Regional Innovation Strategy for the preparation of the EU pre-accession Shannon Region. This report sets out the Operational Programme for Industry and implementation issues arising from previ-

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Competitiveness. The Company was also awarded a number of EU contracts to deliver training support to four regions in Hungary, Poland, Estonia and Slovenia.

Sectoral Development – developing the Health, Sports and Leisure Sector Shannon Development’s goal going forward is to create a ‘must live in’ region – a region synonymous with quality – quality environment; quality physical fabric; quality of life, and quality recreation and leisure facilities. The Company’s ultimate aim is to create a world class region in terms of 13 working, living, learning and leisure. It was Tourism decline prompts swift Kevin Thompstone, Chief against this background that the Health, action Executive, Shannon Development Sports and Leisure (HSL) sector was identi- (left) greeting a visiting delega- fied as one with the potential to contribute The year 2001 was an extremely difficult tion of senior politicians and business leaders from South to these regional aims. one for Irish Tourism generally. For the first Africa’s Northern Province. time in 10 years tourism numbers and rev- Initiatives selected for further development enue declined, due primarily to the threat included HSL Entrepreneurship Training, a and then the reality of Foot & Mouth HSL Bureau to market and promote HSL in Disease (FMD) arriving in Ireland. It had a the Shannon Region, and a four-stage deep impact on tourism across all regions Wellness Programme incorporating: the and sectors, but particularly in rural areas establishment of a ‘Wellness Centre’; the and the activity holiday sectors. Just as the establishment of a health enhancing physi- industry began to look beyond FMD, the cal activity team; the initiation of a tragic events in the United States on ‘Wellness Town’ award scheme, and max- September 11th had an immediate adverse imisation of regional co-operation on impact on travel worldwide and also had health enhancing physical activity. Work on immediate and longer term consequences implanting this programme will continue for access and tourism in the Shannon throughout 2002. Region.

Mary Harney, Tánaiste and Minister for Enterprise, Trade and Employment at the launch of the strategic framework for the development of the HSL sector in the Shannon Region with (from left): Patricia Byrne, Director Knowledge Enterprise, Shannon Development; Dr. Roger Downer, President, University of Limerick; Dr. Pat Duffy, Director, National Coaching and Training Centre and, David Deighan, Business Sectors Development Manager, Shannon Development

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Shannon Development’s response, which is do, see and enjoy in the Region, while continuing, was to intensify its own activi- advising them of the precautions they ties and to encourage and lead a broadly should take. The guides were distributed based co-operative response. free through the Shannon Development Tourist Information Network and the accommodation sector. Shannon Development actions in •Though Foot and Mouth did impact on response to the Foot and Mouth the Company’s planned promotional crisis included: programme (e.g. consumer shows in • Shannon Development brought forward rural Britain), Shannon Development the ‘Shannon Pulse’ surveys to monitor continued to actively promote the business levels (from March) in order to Region in overseas markets, and partici- gauge the difficulties being experienced. pated in trade, consumer and special This information was used to inform our interest holiday shows in Britain, Europe own plans, and those of the Department and France. 14 of Tourism, Sport and Recreation policy • The Company also participated in a num- makers. ber of special overseas Ireland reassur- • Shannon Heritage, the wholly owned ance promotions. During 2001 the subsidiary of Shannon Development, Company worked with key tourism influ- rapidly put in place a range of precau- encers from around the world (travel tionary measures at its attractions which trade, media, conference organisers, allowed the company to offer partial or incentive houses) encouraging them to full experiences at its visitor attractions visit and experience, first hand, the many and entertainments portfolio. These merits of the Shannon Region. efforts also allowed Shannon Heritage to • At an early stage, Shannon Development be the first to fully re-open to visitors. identified the home market as providing • Shannon Development quickly produced best prospects for the Region’s tourism two special comprehensive visitor guides businesses in 2001. The Company con- to the Shannon Region, the first in time cepted a special Ireland promotion called for St. Patrick’s Day giving overseas visi- ‘Raise the Tide’ and, working with the tors information on all that they could Shannon Region tourism trade, under- took an advertising campaign in national

Right: Lambs at Bunratty Folk Park – Shannon Heritage’s proactive and rapid response to the Foot and Mouth threat enabled Bunratty Folk Park to be one of the first visitor attractions to fully reopen to visitors.

Facing page: Walking is truly the best way to absorb the beauty of the Shannon Region. A network of quiet country roads and lanes, forest paths and mountain trails, take you into the heart of beauti- ful rural countryside. Ten national long-distance walking trails traverse the Region's most interesting sites and scenery.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

In response to the serious challenges facing tourism, Shannon Development intensified its marketing efforts to attract overseas visitors. Our picture shows a group of German travel agents who were hosted in the Region by Shannon Development.

newspapers to sell home holidays in the In response to the challenge, a new Shannon Region. We also developed a ‘Shannon & the West Tourism Action Force special website, www.shannonoffers.com, (TAF)’ was established by Shannon which showcased a range of value holi- Development to undertake positive actions day options combining reduced price to increase business into the Shannon accommodation and reduced rates to a Region and the West of Ireland. The range of visitor attractions across the Tourism Action Force comprises Shannon Shannon Region. For many businesses, Development; Ireland West Tourism; Aer home holiday business rescued their sea- Rianta Shannon Airport; Irish Hotels son. Federation; Bed & Breakfast sector; Irish Self Catering Federation; Visitor Attractions; Incoming Tour Operators Responding to the aftermath of the Association (ITOA); Activity Holiday September 11th tragic events in the providers and the Limerick Tourist Trade United States Association. A €1 million plus action plan has been drawn up for all the major mar- The tragic events of September 11th had an kets including the domestic market, Britain, immediate impact on international travel. North America and Europe and implemen- Airlines worldwide cut capacity including tation has begun. routes and frequency of services into Ireland. Shannon International Airport lost Actions by the group begun in 2001 and several major routes, which could translate continuing into 2002 include: into 10,000 less seats per week into Shannon in the main season 2002 when • The expansion of Shannon compared to 2001. Transatlantic capacity Development’s home holiday marketing into Shannon is likely to be down by over activities, including the distribution of 20% in 2002. Defining the impact of this in almost 400,000 brochures in 2002 featur- monetary terms, 3000 visitors staying for ing ‘great-value’ holiday offers; an one week in Ireland will generate almost Ireland holiday-offers internet site which €1.3 million for the local economy. will feature changing value-offers throughout the year, and participation in a series of trade, consumer and special

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

interest promotions. develop a world class golf resort complex in • Intensification by the group of its PR the Region. Following an extensive review efforts in all markets, particularly in the and consultation process, in association UK and North America, projecting posi- with the Doonbeg community, a 153 tive messages about holidaying in the hectare sand dunes site at Doonbeg was Shannon Region and the West of Ireland selected by Shannon Development as the to a wide audience. preferred location for this flagship project. Following a call for proposals from the • Shannon Development commissioned an international marketplace, leading US internet-based ‘travel-media resource based golf resort promoters were approved centre’ which will assist media to pick up by Shannon Development to take the proj- travel-related breaking news and more ect forward through to implementation. general tourism and leisure holiday sto- ries from the Shannon Region and West Construction work on the €50.79 million of Ireland. Media ‘subscribing’ to the site (£40m) project progressed significantly dur- will also receive email communications ing 2001. The fully completed complex, 17 keeping them up-to-date on develop- which will comprise a world class golf ments. course, clubhouse, leisure facilities, and a • Attendance at over 60 travel trade, con- high quality hotel and residential units, will sumer and special interest promotions in represent the single largest tourism devel- Britain, Mainland Europe and North opment to be undertaken in the West of America. Working with tour operators Ireland. on sales-focused initiatives and generally supporting their efforts all aimed at boosting business in 2002. Limerick Navigation and Marina •A March 2002 launch of ‘The Daily The Limerick City Navigation and Marina Adventure’ a new Shannon Region pub- project was also completed during the year. lication aimed at encouraging visitors to The project was initiated originally in 1995 Sile DeVelara TD, then Minister the Region to explore the area and enjoy by Shannon Development and Limerick City for Arts Heritage, Gaeltacht and Council. In national terms the project has the Islands, opened in the the Region’s top visitor attractions and Limerick Navigation in July entertainments. Over 200,000 copies of removed the last navigational obstruction 2001. The Minister is pictured the new guide will be distributed. on the River Shannon and Erne Waterway. at the opening with senior repre- Regionally, the project has connected the sentatives from project partners, Limerick City Council, Shannon well established marine tourism centres of Development and Waterways Tourism Product Development Lough Derg with the Shannon Estuary. In Ireland. Over the five year period of the 1994-99 Operational Programme for Tourism, Shannon Development secured €26.19m (£20.62m) in grant aid for some 75 projects involving a capital investment of €131.02m (£103.19m) throughout the Region. The success of the Programme enabled the Company, with the support of EU aid, to address many of the strategic gaps in the Region’s product portfolio, and to put in place new facilities to take advantage of emerging market opportunities.

Doonbeg Golf Course Based on a study of market demand, in 1995, Shannon Development concepted and promoted an investment proposal to

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Limerick City terms, the project has brought Regional cycling trail programme a new tourism revenue impetus to Limerick An ERDF grant of €66,660 (£52,500) was which is already bearing fruit in spawning a secured by the Company for a number of range of complementary investments in cycling projects which were completed in bars, hotels, and restaurants adjacent to the 2001. Walking and cycling is becoming one Marina. The project is the result of the of the fastest growing outdoor pursuits partnership efforts of Waterways Ireland, engaged in by overseas holidaymakers to Limerick City Council and Shannon Ireland. Following research on the cycling Development. product by Shannon Development, a number of areas in the Shannon Region including North Kerry, Lough Derg and the Burren Glor – giving a home to traditional Irish area of North Clare were identified as pro- music viding opportunities for development. In 1994, Shannon Development and Ennis Urban District Council identified market demand to develop the National Folk Music 18 Other developments Centre as the Tourism Product Flagship Other projects in the Shannon Region within an overall tourism development assisted by Shannon Development under strategy for Ennis. This was subsequently the EU Operational Programmes for endorsed by the National Tourism Council, Tourism in the Shannon Region include Birr and the Ennis Tourism Development Board Science Centre, Tralee Aqua Golf, and the worked up the proposal into a viable busi- Great Gardens of Ireland restoration pro- ness plan which, in March 1999, was gramme, which saw the restoration of four approved by the Independent Product historic gardens in the Shannon Region at Board – Shannon Region for an ERDF grant Bunratty Castle and Folk Park, Knappogue of €634,870 (£500,000). The project which Castle, the Vandeleur gardens in Kilrush, cost €8.25 million (£6.5m), including €5.7 and Birr Castle gardens in Co. Offaly. million (£4.5m) funding received from the Accommodation sector grants were Department of Arts Heritage Gaelteacht awarded to a number of hotels for refur- and the Islands, opened in 2001 and com- bishment work, and for the addition of con- prises a purpose built centre providing the ference facilities. visitor with a unique format of daytime/evening traditional Irish music experience in line with identified market Tracking business levels demand. Shannon Development continues to track The Glor building in Ennis Ð a superb addition to the Shannon tourism business performance in the Region’s range of cultural and Shannon Region through the Shannon tourism attractions. Pulse. During 2001 several Shannon Pulse surveys were undertaken by MRBI on behalf of the company. The last Pulse survey of 2001, covering the period January to October, showed that almost 2 in every 3 tourism businesses (64%) experienced a decline in their overall holiday and leisure business in 2001. Overseas business was most impacted upon with almost 3 in every 4 (74%) experiencing a downturn. The Ireland market performed best and, for many, this market rescued their season – 71% of all businesses experienced parity (52%) or growth (19%) on the home holiday market compared to the same period in 2000.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

Based on the 131 businesses surveyed in the relation to the mediaeval banqueting oper- October Shannon Pulse survey, almost half ations, staff hall and carvery service at year of all tourism businesses in the Shannon end. The catering operation was put out to Region (48%) expect business in 2002 to be tender and, in December 2001, Shannon down on 2001. Of the 93 businesses that Heritage appointed Shannon Hospitality as have North American business, not one was the new catering contractor. Shannon anticipating growth in 2002. The Shannon Hospitality will cater for guests to Bunratty Pulse forecast signals the challenge that lies and Knappogue mediaeval Banquets, ‘Style’ ahead for 2002 and beyond. in the Corn Barn at Bunratty Folk Park, and visitors to Bunratty Folk Park during the season. Shannon Hospitality is a partner- Shannon Heritage ship between two of Ireland’s leading cater- Shannon Development’s tourism subsidiary, ing companies, Masterchefs and Compass Shannon Heritage, like many businesses in Group. the tourism sector experienced a very difficult year, with Foot & Mouth Disease in 19 March, the general economic slow down, The tourism challenges ahead and then the tragic events of September Tourism benefits international carriers and 11th in the USA. underpins services, especially air services, into the West of Ireland. It supports the economies of our cities, towns and villages Over 630,000 visitors attended Shannon Pictured at the opening of the Heritage’s range of eight day visitor attrac- and the growing base of accommodations, new HB House exhibit at tions and three evening entertainments, entertainments, attractions, internal trans- Bunratty Folk Park were (L Ð R) port providers, manufacturers and suppliers Brian O’Connell, Chairman, down 12% on the 2000 figures of just over Shannon Heritage, Niall 716,000 in 2000 (which was one of the best of a myriad of consumables from food and FitzGerald, Chairman and Chief results in the Company’s 41 year history). beverages to gift items. Executive, Unilever Plc, William Hughes, son of a founding mem- During the year, the Company continued to ber of HB ice cream firm, John expand its range of product attractions. In In 2001 events have ensured that this link- King, Director of Heritage and June, the Company added a major new fea- age is now better understood than ever Tourism, Shannon Development, before. In this context, Shannon Jules Noten, Chairman, Unilever ture, the HB House, to its Bunratty Folk Park Best Foods and Liam McElligott, attraction in Co. Clare. The original HB Development will continue to increase its Chairman, Shannon house, which was at the centre of the dairy focus on tourism, in response to the chal- Development. farm where the Hughes family produced the first HB ice cream, has been authenti- cally recreated at the Folk Park. Shannon Heritage was given an opportunity to res- cue as much as possible of the original building and preserve this part of Irish history for posterity at Bunratty Folk Park.

In July, Shannon Heritage opened the newly extended ‘Cornbarn’ at Bunratty Folk Park, which is home to ‘STYLE’, a traditional evening of entertainment which traces the history of Irish Dance. Famous visitors to the Folk Park during the year included international movie star Pierce Brosnan who visited the Folk Park on his honey- moon.

In late September, Aer Rianta Shannon noti- fied Shannon Heritage that they were ter- minating their catering agreement in

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REVIEW OF THE YEAR

lenges that lie ahead over the next few years, as we all work to re-build business levels. The Tourism Action Force (TAF) plan currently being implemented will be the critical work in this respect for 2002.

A key objective going forward for the West of Ireland will be the tourism regions working co-operatively to promote and market the western region to the international consumers in the various overseas markets. This is seen as critical for the West, and significant discussions and meetings are already under way with a view to putting a western tourism alliance in place. Any new co-operative arrangements will link into the 20 international marketing framework being provided by Tourism Ireland.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY ORGANISATION

Board 2001, F. Keane-Carmody in June 2001 and P. Schutz in July 2001. In accordance with the Company’s Articles of Association, Directors are appointed by J. Bourke resigned as Company Secretary in the Minister for Enterprise Trade & February 2001 and S. Fitzgibbon was Employment after consultation with the appointed. Minister for Finance and the Minister for Arts, Sport and Tourism (formerly Tourism, Sport and Recreation). The Directors at 31st December 2001 were: Company Committees A number of Board and Executive L. McElligott (Chairman) Committees are in place to assist the Board P. Collins and the Company in their tasks. At 31 R. Carroll December 2001, the Committees and their N. Foran membership were as follows: K. Grace F. Keane-Carmody 21 W. Loughnane Board Committees P. O’Brien B. O’Connell Audit Committee P. Schutz R. Carroll (Chairman) M. Stack L. McElligott E.M. Walsh The Audit Committee exercises powers del- S. Fitzgibbon (Company Secretary) egated to it by the Board to oversee the financial reporting process and the In accordance with Article 75 of the Articles Company’s system of internal controls. of Association, B. Dinneen and R. Carroll retired by rotation in May 2001. R. Carroll Economic Policy Sub-Committee was re-appointed. S. Gorman retired in B. O’Connell (Chairman) April 2001. E.M. Walsh L. McElligott The Minister for Enterprise Trade & This Sub-Committee of the Board exercises Employment in accordance with Article 77, powers delegated to it by the Board to and after consultation with the Minister for undertake specific tasks in the economic Finance and the Minister for Tourism Sport policy area. & Recreation, appointed K. Grace in April

Shannon Development Board: seated (L Ð R) Liam McElligott, Chairman, Ron Carroll, Kieran Grace, and Patricia Collins, standing (L Ð R) Willie Loughnane, Noreen Foran, Paul O’Brien, Brian O’Connell, Frieda Carmody, and Peter Schutz. Inset: Morgan Stack and Dr Edward Walsh.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY ORGANISATION

Property Sub-Committee Investment Committee P. O’Brien (Chairman) R. Carroll (Chairman) N. Foran P. Byrne M. Stack P. Collins M. Leydon This Sub-Committee of the Board exercises B. Lyons powers delegated to it by the Board to B. McCormack oversee the property related activities of T. O’Niadh the Company. D. Coppinger F. O’Morain Executive Committees K. Thompstone Executive Committee Secretary: S. Fitzpatrick K. Thompstone, Chief Executive (Chairman) The Committee exercises specific powers P. Byrne, Director – Knowledge Enterprise delegated to it by the Board, decides on S. Fitzgibbon – Company Secretary and applications for grant and other assistance 22 Director, Corporate Development subject to specified limits for industrial proj- J. King, Director – Heritage and Tourism ects, issues recommendations on operating O. Loughnane – Director, Research, licences, and decides on 10% taxation cer- Development and Communications tificates for Shannon based companies and M. McKeogh, Director – Spatial on the disposal of associated buildings and Development sites. Secretary: S. Fitzpatrick Management Approvals Committee The Executive Committee is the senior exec- M. McKeogh (Chairman) utive body in the Company and exercises J. Dillon specific powers delegated to it by the S. Fitzgibbon Board. M. Fogarty A. Morgan N. O’Sullivan Secretary: M. O’Loughlin

Shannon Development Executive Committee: seated (L Ð R), John King, Director of Heritage and Tourism, Kevin Thompstone, Chief Executive, Olivia Loughnane, Director of Research, Development and Communications. Standing (L Ð R), Patricia Byrne, Director of Knowledge Enterprise, Martin McKeogh, Director of Spatial Development. Sean Fitzgibbon, Company Secretary and Director of Corporate Development.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY ORGANISATION

The Committee exercises specific powers The National Technological Park Plassey Ltd delegated to it by the Board relating to the K. Thompstone (Chairman) promotion of industry, the approval of R. Downer grant aided projects, and the making of P. Coyle equity investments. N. Frawley M. McKenna M. McNamara Subsidiary companies J. O’Connor The Company also has a number of sub- B. Sweeney sidiary companies with specific objectives Company Secretary: M. Flanagan relating to its overall tasks of securing sus- This company is responsible for the overall tainable economic growth within the development of the National Technological Shannon Region. The following is a list of Park in Limerick, and draws upon inputs the subsidiary companies, together with from the University of Limerick, IDA Ireland, their directors, that were trading at 31st Enterprise Ireland, Department of December 2001: Enterprise Trade & Employment, and the 23 private sector, all of whom are represented Shannon Castle Banquets & Heritage Ltd on the Board. B. O’Connell (Chairman) F. Brennan Shannon Estuary Development Ltd J. King L. McElligott (Chairman) W. Loughnane W. Moloney J. Madden M. Nolan L. McElligott R. O’Ceallaigh K. Thompstone R. Ryan Company Secretary: M. Holohan K. Thompstone The Company is responsible for the devel- Company Secretary: M. O’Loughlin opment and operation, on a commercial This subsidiary was established by Shannon basis, of the Company’s day visitor attrac- Development to focus on economic devel- tions and medieval banquets to the highest opment issues specifically related to the standards. Shannon Estuary. The Board is comprised of senior representatives from Shannon Kilrush Creek Marina Ltd Development, IDA Ireland, Shannon Foynes L. McElligott (Chairman) Port Company, and the four local authori- T. Kerin ties whose areas of responsibility include F. Larkin the Shannon Estuary. B. Lynch M. McNamara T. Prendeville Liaison M. Reidy The Company’s work embraces a diverse Company Secretary: M. O’Loughlin range of activities, and requires close liaison, and in many cases cooperation with, a The company is responsible for the promo- multiplicity of individuals and organisations tion and management of Kilrush Marina as within and without the Shannon Region. an integrated marine related tourism and The Company acknowledges the support recreational services project. and cooperation it received from all con- cerned during the year.

Worker Participation (State Enterprise) Act 1988 There are established mechanisms in place to facilitate staff participation and involve-

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY ORGANISATION

ment within the Organisation. These During 2001, the Company’s Safety include: Committee met regularly and dealt with a number of initiatives including training • Regular information and consultation additional staff in health and safety proce- meetings between staff representatives dures; liaison with staff in implementing and Senior management the Company’s response to the threat of • Regular team briefings at group and divi- foot and mouth disease; female cancer sion level screening held in July; circulation of recommended procedures for dealing with suspi- • Staff involvement on various cross func- cious in-coming mail (following incidents of tional and multi level project teams Anthrax scares in the U.S.); provision of sup- aimed at enhancing corporate efficiency port to Shannon Heritage in pro-actively and effectiveness and improving cus- tackling health and safety issues. tomer service Existing arrangements will be reviewed and developed to ensure that they continue to Staff numbers 24 contribute to the development of corporate The average number of persons employed capability and workplace relations. in integrated economic development activities (which includes wholly owned subsidiaries) was 419. The figure includes the Equal Opportunities number of whole time staff, plus the num- Shannon Development is an equal opportu- ber of seasonal staff converted to full time nities employer and is fully committed to equivalents, employed by the group. The equality of opportunity in all of its employ- equivalent number in respect of 2000 was ment practices, policies and procedures. A 421. programme is in place to further develop new Equality Policies and initiatives, particularly, with regard to awareness training on Organisation Development combating bullying and harassment in the During 2001, the Company continued to work place, staff development, and the develop its Quality Programme using the extension of family friendly working Business Excellence Model as a framework arrangements. to identify strengths and areas for improvement. Accreditation to the Q Mark and ISO 9002 continued during 2001. Health and Safety The health and safety of the Company’s The Company is an active member of ICBE employees are safeguarded through strict (The Irish Centre for Business Excellence) adherence to health and safety standards. and uses this forum to network/benchmark Standards in relation to health and safety with other companies involved in the pro- are based on requirements of employment motion of best practice within their Picture of the first staff group to complete the ECDL computer legislation, including the Safety, Health and Organisations. training programme in July 2001. Welfare at Work Act, 1989.

Ethics in Public Office Act 1995 In accordance with the Ethics in Public Office Act 1995, Shannon Development directors, and staff holding designated positions, have completed statements of interest in compliance with the provisions of the Act.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

SHANNON CASTLE BANQUETS & HERITAGE Employment Breakdown in Shannon Free Zone (Dec. 2001) Attendances at Banquets and Evening Entertainment Products Manufacturing 4,921 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Services 3,009 1997 1998 1999 2000 2001 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– 120,898 135,838 133,958 136,734 121,743 Cost per job ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Cost per job (created & sustained) by programme in 2001 ––––––––––––––––––––––––––––––––––––––––––––––––––––– Attendances at Day Visitor Attractions € ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Shannon Region Indigenous Industry 9,834 524,416 531,333 543,901 579,930 513,382 Shannon Free Zone €17,328 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Overall Average €12,837 –––––––––––––––––––––––––––––––––––––––––––––––––––––

EMPLOYMENT IN THE SHANNON REGION 2001 Cost per job (created & sustained) by sector in 2001 Employment Creation 2001 ––––––––––––––––––––––––––––––––––––––––––––––––––––– (Shannon Free Zone and Irish companies in the Shannon Region) Electronics & Engineering € –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– 18,264 2000* 2000 Gains Losses Change 2001 Food & Drink €11,160 –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Services €8,434 25 Total Irish 13,914 14,020 1,127 1,726 -599 13,421 Other €10,939 Shannon Free Zone 8,058 8,029 683 782 -99 7,930 ––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– In accordance with the methodology outlined by the Department of Enterprise, Trade and Employment, as highlighted in para. 4.18 of the Total 21,972 22,049 1,810 2,508 -698 21,351 Review of Industrial Performance (1990), the cost per job is calculated –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– by relating new jobs created and sustained during 1995-2001 to all * To allow meaningful comparison with the end of year figures for 2001, grants paid (at constant 2001 prices) during the period 1994-2000.The the base figure for jobs in Irish owned companies assisted by Shannon derived cost is therefore a moving average and may fluctuate upwards Development, as set out in the Annual Report for 2000, has been adjusted or downwards. to take account of relevant changes which occurred during 2001, such as companies changing from being Irish owned to foreign owned or vica versa, and relocation or reclassification of companies. SHANNON TOWN Employment by Sector 2001 Schools (Shannon Free Zone and Irish companies in the Shannon Region) ––––––––––––––––––––––––––––––––––––––––––––––––––––– Number Teachers Pupils –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– ––––––––––––––––––––––––––––––––––––––––––––––––––––– Sector No. % –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Primary 6 51 920 Agriculture, Horticulture, Food & Drink 3,827 18 Post Primary 2 90 1,220 Non-Metallic Minerals 1,388 7 3rd Level 1 22 118 ––––––––––––––––––––––––––––––––––––––––––––––––––––– Metals, Engineering & Electronics 7,471 35 Chemicals & Pharmaceuticals 768 4 Housing Stock Textiles & Clothing 498 2 ––––––––––––––––––––––––––––––––––––––––––––––––––––– Timber & Wood Furniture 560 3 Shannon Development Rented Houses 43 Paper, Print & Publishing 731 3 Shannon Development Rented Apartments 30 Plastics & Rubber 766 4 Clare Co. Council Rented Houses 115 Other manufacturing 1,006 4 Private Houses and Apartments 2,940 Services 4,336 20 ––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Total 3,128 Total 21,351 100 ––––––––––––––––––––––––––––––––––––––––––––––––––––– ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Employment in Shannon Free Zone by Country of Origin (Dec. 2001) –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Ireland 927 Europe (EU) 2,517 Europe (non EU) 550 USA & Canada 3,900 Other 36 –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– Total 7,930 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

Industry grant payments 2001

Developer Name Project Description Payments made Total Payments in 2001 € IR£ € IR£ SHANNON FREE ZONE Air Excellence International Upgrading Aircraft Panels 5,953 4,688 117,071 92,201 Aon Insurance Managers (Shannon) Insurance & Reinsurance 82,533 65,000 184,112 145,000 Beta Layout Ltd Printed Circuit Boards 16,568 13,048 131,889 103,871 CME (Ireland) Ltd Solar Heating Systems 12,946 10,196 126,212 99,400 Compuscript Ltd Publishing Services 62,563 49,272 223,236 175,813 DMC Medical Ltd Cardiovascular Products 4,854 3,823 42,873 33,765 Halifax Insurance (Irl) Ltd Data Processing Services 204,851 161,333 204,851 161,333 Incline Repair Services Ltd Flat Panel Displays 470,620 370,643 470,620 370,643 Lufthansa Aircraft Painting Shannon Ltd Aircraft Refurbishment & Painting 243,602 191,852 243,602 191,852 26 Mentor Graphics (Irl) Ltd Software Fulfilment 79,128 62,318 471,447 371,295 NavaraSoft Ltd Computer Software 31,743 25,000 234,902 185,000 Pan European Communications GMBH & Co Call Centre 480,215 378,200 480,215 378,200 Phardiag Ltd Pharmaceutical Distribution 100,189 78,905 165,066 130,000 Shannon Aircraft Motor Works Ltd Aircraft Electrical Repair 125,011 98,454 1,382,911 1,089,131 SIMAR International Services Ltd Laptop Refurbishment 44,568 35,100 218,395 172,000 SPS International Ltd Fasteners 12,654 9,966 5,074,395 3,996,411 Tekelek Europe Ltd Electronic Control Systems 11,428 9,000 547,958 431,552 Veritas Software (International) Ltd Data Processing 238,076 187,500 238,076 187,500

LIMERICK CITY Atlas Aluminium Ltd Die Castings, Aluminium 82,696 65,128 5,534,184 4,358,524 Ballyneety Manufacturing Service Ltd Electronic Torque Wrench 43,604 34,341 1,098,211 864,912 Clancy Radiators Ltd Fabricated Metal Products 40,709 32,061 357,613 281,643 CVA International Ltd Training Service 5,196 4,092 75,690 59,611 Dutec Ltd Floppy Discs 98,087 77,250 186,725 147,058 Fitzpack Packaging Paper & Board 45,077 35,501 359,476 283,110 Foot Health Limited Orthotics 8,888 7,000 8,888 7,000 Gentech Electronic Limited Electronic Support 9,688 7,630 83,168 65,500 Hegarty Metals Manufacturing Ltd Primary Nonferrous Metals 25,395 20,000 259,873 204,667 Key Tech Products Limited Cable Assembly & Manufacture 44,611 35,134 1,787,064 1,407,427 M&Q Packaging Ltd Plastic Products 34,489 27,162 143,389 112,928 Medrex Limited Printing & Publishing 15,872 12,500 136,897 107,815 Moyross Community Enterprise Centre Ltd Community Services 17,908 14,104 22,130 17,429 O.M.C. Engineering Ltd Stainless Steel Products 104,653 82,421 841,747 662,929 O.M.C. Scientific (Manufacturing) Ltd Sputtering Shield Recovery 333,131 262,362 750,984 591,448 OMC Technologies Ltd Clean Room Equipment 206,910 162,955 206,910 162,955 Shannon Coiled Springs Ltd Springs 14,119 11,120 286,168 225,375 Shannon Mineral Waters Soft Drinks 27,807 21,900 303,349 238,907 Speedline Engineering Wrought Iron Products 25,395 20,000 107,928 85,000 Takumi Precision Engineering Ltd Jigs 3,667 2,888 3,667 2,888

COUNTY LIMERICK Abrel Products Ltd Electronic Test Equipment 34,918 27,500 104,119 82,000 Accutron Ltd Electronic Design & Development 5,903 4,649 172,470 135,831 Action Learning Multimedia Educational Software 15,450 12,168 38,744 30,513

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

Developer Name Project Description Payments made Total Payments in 2001 € IR£ € IR£

Acton Technologies Ltd Teflon 6,349 5,000 177,763 140,000 Ashling Microsystems Ltd Microprocessor Development Systems 68,881 54,248 1,606,305 1,265,068 Ballyhoura Food Centre (Hospital) Ltd Food Products 126,974 100,000 126,974 100,000 Beacon Integrated Solutions (BIS) Software Development 25,027 19,710 202,911 159,806 Compu B Limited Computer Hardware 40,696 32,051 40,696 32,051 Coupon Globe Ltd Online Interactive Marketing Services 3,804 2,996 3,804 2,996 DataMate Global Communications Limited Communication Devices 254,086 200,109 254,581 200,499 Delta Filtration Ltd Filter Products 185,686 146,240 396,486 312,258 Designwise Automation Ltd Automated Equipment 381 300 6,730 5,300 Digital Mentors Ltd Networking Software Packages 28,569 22,500 38,092 30,000 E-Live Ltd Data Management Services 3,174 2,500 3,174 2,500 Extranet Solutions Limited Software Development 8,098 6,378 18,411 14,500 27 eZee Global Software Ltd Software System 6,176 4,864 6,176 4,864 Galtee Wood Products Ltd Wood Kitchen Cabinets & Vanities 81,244 63,985 1,573,376 1,239,134 Go2mobile Solutions Ltd Software Development 3,174 2,500 28,569 22,500 Greenacres Foods (Ireland) Limited Value Added Vegetable Based Products 94,554 74,467 883,486 695,802 HomeNet Communications Ltd Security Systems, Computerised 152,215 119,879 166,261 130,941 Incept Ltd Eprom Emulators 3,174 2,500 25,345 19,961 Ingredient Solutions Ltd Cheese Ingredients 19,046 15,000 19,046 15,000 Intime Management Systems Ltd Software Support Services 10,859 8,552 10,859 8,552 Keltec Machine Sales Ltd General Fabrication 19,046 15,000 43,070 33,920 Kit-Fab (Irl) Ltd PVC/Aluminium Windows & Doors 104,753 82,500 1,136,579 895,129 Lighthouse Communications Software Systems 393 310 184,398 145,225 ManOPT Systems Ltd Software Support Services 1,517 1,194 3,628 2,857 Maxine Mearns Pottery Products 229 180 762 600 Mercury Analytical Ltd Testing Laboratories 4,222 3,325 68,474 53,928 Mid-West Mantle & Design Ltd Fireplaces & Surrounds 36,948 29,099 257,513 202,808 Migration Support Systems Limited Computer Software 22,855 18,000 29,743 23,425 New Vistas Healthcare Ltd Health Care Products 22,233 17,510 152,211 119,876 Nova Foods Oriental Sauces 4,687 3,691 25,465 20,055 Ophtecs (Euro) Ltd Contact Lens Cleaning Solutions 396,519 312,284 396,519 312,284 Piercom Ltd Computer Software 26,664 21,000 1,338,771 1,054,368 Premier Molasses Company Ltd Agricultural Molasses 30,804 24,260 77,469 61,012 Samco Ltd Seed Planting Machines 9,523 7,500 72,320 56,957 Sapphire Engineering Ltd Fabricated Metal Products 5,714 4,500 362,357 285,379 Shannon Enterprise Technologies Software Systems 523 412 17,154 13,510 Shannon Soft Ltd Software & Services 51,680 40,701 95,449 75,172 Small Business Institute Business Services 762 600 22,030 17,350 Pat Smith Engineering Ltd Switchgear/Switchboard Apparatus 22,855 18,000 79,993 63,000 Suparule Systems Ltd Ultrasonic Industrial Equipment 20,518 16,159 446,446 351,605 Systems Expertise Limited Information Systems 1,049 826 1,648 1,298 Tango Telecommunications Communications Equipment 439,873 346,428 631,634 497,452 Test & Manufacturing Technology Ltd Cable Assembly & Manufacture 823 648 1,897 1,494 Transtest Ltd Electrical Engineering 183,768 144,729 727,913 573,278 URO Devices Ltd Surgical & Medical Instruments 15,044 11,848 52,226 41,131 Vigitek Limited Automatic Visual Inspection 121,652 95,809 596,868 470,072 W3 Services Ltd Internet Development 22,130 17,429 120,144 94,621 M & M Walshe & Co. Ltd Processed Meats 4,238 3,338 432,516 340,634 WB Industrial Furniture Ltd Steel Furniture 11,745 9,250 11,745 9,250

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

Developer Name Project Description Payments made Total Payments in 2001 € IR£ € IR£

Wireless ROI Wireless Comm. Mgmt. Products 25,936 20,426 30,697 24,176 Wren Data Ltd Networking Software Packages 6,168 4,858 141,685 111,586

COUNTY CLARE AJ Precision Components Ltd Injection Moulded Plastic Products 72,819 57,350 649,549 511,562 BH Associates Ltd Software for Freight Industry 18,513 14,580 98,979 77,952 Cregg Mouldings Limited Plastic Injection Moulding 7,111 5,600 306,230 241,176 Data Display Limited Display Signs 93,661 73,764 1,583,258 1,246,917 Deerpark Publishing Services Ltd Editing Services 22,855 18,000 159,987 126,000 Europa Precision Components Irl. Ltd Fabricated Metal Products 12,697 10,000 53,751 42,332 Galvotech (International) Ltd Plating 4,763 3,751 325,207 256,122 28 Gourmet Solutions of Ireland Ltd E-Business 3,365 2,650 3,365 2,650 H&G Tooltech Limited Die Castings, Aluminium 40,087 31,571 65,482 51,571 Ingenium Systems Ltd Software Support Services 227,601 179,250 227,601 179,250 JK Computer Services Ltd Technical Services 6,349 5,000 12,697 10,000 Lasercut Engineering Laser Equipment 38,092 30,000 38,092 30,000 Leadmore Ireland Ltd Ice Cream & Frozen Desserts 15,465 12,180 218,008 171,695 Materials Measurements Ltd Commercial Aircraft Services 40,632 32,000 40,632 32,000 Mincon International Ltd Rock Drilling Equipment 37,108 29,225 770,265 606,633 Modular Automation Molex Ltd Special Purpose Machine Builders 133,322 105,000 261,240 205,743 Molloy Woodcrafts Ltd Pine Furniture 8,999 7,087 8,999 7,087 NGS Products (Shannon) Ltd Steel Wire Products 29,600 23,312 117,091 92,217 Nordman Profile Limited Tile Roofing 7,494 5,902 158,501 124,830 Nowcasting International Ltd Marine Telematics 18,904 14,888 339,489 267,369 O'Connor's Confectionery (Ennis) Ltd Confectionery Products 21,346 16,811 55,995 44,100 Rineanna Business Solutions Ltd Software Development 3,301 2,600 3,301 2,600 Sea Lyons Seafood Sales Ltd Crab & Shrimp Processing 19,046 15,000 19,046 15,000 Small Business Operational Programme Develop Service Business 156,912 123,578 187,882 147,969 Smithstown Light Engineering Ltd Special Dies/Tools/Jigs & Fixtures 66,160 52,105 900,041 708,840 The Burren Smokehouse Limited Smoked Fish 8,644 6,808 300,990 237,049 Vitalograph Irl. Ltd Medical Instruments & Supplies 64,677 50,937 1,174,343 924,871

NORTH TIPPERARY Breadline Productions Ltd Media Animation 7,546 5,943 7,546 5,943 Cambewell Man. Ltd t/a Castle Brand Cookware Products 36,678 28,886 945,391 744,556 Carey Glass Limited Glass Products 348,684 274,611 3,647,786 2,872,865 Celtbury Ltd Oven Ready Meals 255,412 201,153 687,959 541,812 Centenary Co-op Creamery Ltd Dairy Products 2,666 2,100 105,091 82,766 Codicrafts Ltd Specialist Furniture & Fixtures 7,111 5,600 13,472 10,610 Erin Foods Mfg Limited Consumer Food Products 63,519 50,025 2,340,103 1,842,981 Lakeshore Foods Ltd Sauces & Prepared Mustards 9,713 7,650 155,575 122,525 Liathmore Cheese Co. Ltd Cream Cheese 27,859 21,941 189,854 149,522 MJM Electronics Electronic Components 4,666 3,675 189,805 149,484 T&J Standish (Sawmills) Ltd Wooden Fences 8,126 6,400 8,126 6,400 Tipperary Fabrication Ltd Fire Escapes/Railings 19,122 15,060 85,784 67,560 Tipperary Glass Ltd Glass Products 43,489 34,250 104,417 82,235

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

Developer Name Project Description Payments made Total Payments in 2001 € IR£ € IR£ SOUTH OFFALY Glass Innovations Ltd Specialised Glass Finishing 63,487 50,000 63,487 50,000 Milne Foods Ltd Vacuum Packed Vegetables 19,046 15,000 297,813 234,547

NORTH KERRY Advanced Industries Ltd Agricultural Machinery 53,329 42,000 327,200 257,691 Aqua Design Ltd Waterjet Cutting Tool 3,174 2,500 23,681 18,650 Ardfert Quarries Ltd Concrete, Gypsum & Plaster 31,197 24,570 31,197 24,570 Aspen Workflow Ltd Software Development 286,009 225,250 286,009 225,250 Brandon Products Ltd Natural Cosmetics 26,971 21,241 127,566 100,466 Cameo Products Limited Confectionery 26,451 20,832 230,045 181,175 Compound Feed Engineering Die Refurbishment 25,395 20,000 72,343 56,975 29 Pat Crean Chimney Cowls 11,834 9,320 11,834 9,320 Forest Produce Ltd Forestry 59,631 46,963 96,898 76,313 GuruBooks.Com Ltd Computer Manuals 23,490 18,500 118,721 93,500 InterWAVE Communications Ireland Ltd Telecommunications Equipment 182,756 143,932 790,412 622,500 Kerry Group Plc Dairy products 230,127 181,240 6,144,035 4,838,821 Tim Lawlor Mining Machinery 10,866 8,558 10,866 8,558 Metpro Ltd Corrosion Inhibitors 29,878 23,531 147,615 116,256 O'Sullivans Marine Ltd Ship/Boat Building & Repair 56,040 44,135 477,300 375,904 Pulselearning Ltd Computer Training Products 360,396 283,835 360,396 283,835

Note: Grant approvals for overseas industries (with the exception of the food and natural resources sector) in the Shannon Region, outside of Shannon Free Zone, are the responsibility of IDA Ireland. Enterprise Ireland has responsibility for overseas industry in the food and natural resources sector.

EQUITY INVESTMENTS 2001 Company Name Project Description Investment made Total Investment in 2001 € IR£ € IR£ Aspen Investment Corporation Ltd Software Development 190,461 150,000 190,461 150,000 Celtbury Ltd Oven Ready Foods 126,974 100,000 253,948 200,000 Datamate Global Communications Ltd Short Messaging Communications Devices 190,461 150,000 190,461 150,000 Glass Innovations Ltd Specialised Glass Finishing 63,487 50,000 63,487 50,000 Homenet Communications Ltd Computerised Security Systems 126,974 100,000 126,974 100,000 Ingenium Systems Ltd Software Support Services 133,322 105,000 133,322 105,000 Key Tech Products Ltd Cable Assembly & Manufacture 44,611 35,134 577,901 455,134 Pulselearning Ltd Computer Based Training 190,461 150,000 190,461 150,000 Tango Telecoms Ltd Telecommunication Equipment 190,461 150,000 190,461 150,000 Transtest Ltd Electrical Engineering 126,974 100,000 253,948 200,000

The development of industry had been greatly assisted by the transfer of European Structural Funds. These funds make a significant contribution to the Irish Government’s Productive Sector Operational Programme by encouraging industry to locate in Ireland, and by generating major employment opportunities and technological development in the Region.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATISTICAL INFORMATION

EU OPERATIONAL PROGRAMME FOR TOURISM 1994 – 1999 Tourism Project Payments 2001 Developer Project Description Payments in 2001 € IR£

Doonbeg Golf Club Ltd Doonbeg Golf Course 720,117 567,138 Limerick Co. Council Tourism Signposting – County Limerick 33,342 26,259 Shannon Development Tourism Signposting – Lough Derg 4,626 3,643 Shannon Development TIO Computerisation 42,517 33,485 Ennis UDC/Shannon Development Ennis Tourist Information Office 7,191 5,663 Ennis UDC International Folk Music Centre 600,929 473,270 Clare Co. Council Killaloe/Ballina Heritage Town 16,628 13,096 Birr Scientific & Heritage Foundation Birr Science Centre 31,458 24,775 Limerick Corporation Limerick City Navigation Project 231,833 182,583 Silver Line Cruisers Ltd Fleet Expansion 8,253 6,500 Shannon Development Walking Upgrading Programme 10,044 7,910 30 Shannon Development Shannon Region Cycling Trails 61,483 48,422 Shannon Castle Banquets & Heritage Ltd Heritage Garden Programme – Knappogue 20,452 16,107 Birr Scientific & Heritage Foundation Heritage Garden Programme – Birr 28,583 22,511 Shannon Castle Banquets & Heritage Ltd Heritage Garden Programme – Bunratty 26,550 20,910 Kerry Co. Council Tourism & the Environment Initiative 142,673 112,364 Offaly Co. Council Tourism & the Environment Initiative 100,317 79,006 Shannon Development Tourism & the Environment Initiative 174,875 137,725 Tipperary (NR) Co. Council Tourism & the Environment Initiative 15,959 12,569 Institute of Technology Tralee Tourism & the Environment Initiative 74,098 58,357

The development of tourism has been greatly assisted by the transfer of European Regional Development Funds. These funds make a significant contribution to the Irish Government’s Tourism Operational Programme by encouraging the development of new tourism products and creating substan- tial employment opportunities throughout the Shannon Region.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 DIRECTORS’ REPORT AND CONSOLIDATED FINANCIAL STATEMENTS

Directors’ Report and Consolidated Fianacial Statements

Year ended 31 December, 2001

CONTENTS

Report of the Directors 32 Report of the Comptroller and Auditor General 35 Accounting Policies 36 Consolidated Income and Expenditure Account 38 31 Statement of Movement in Retained Surpluses 39 Consolidated Balance Sheet 40 Company Balance Sheet 41 Consolidated Cash Flow Statement 42 Notes to the Financial Statements 43

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REPORT OF THE DIRECTORS

Report of the Directors Highlights of the Year Highlights of the year 2001 for the Company include: The Directors submit their report together with the audited financial statements for the year-ended 31 December, 2001. • Companies in the Shannon Region supported by Shannon Development created 1,810 new jobs in 2001 – 683 jobs were created by companies at the Shannon Free Zone while 1,127 Directors’ Responsibilities were created by indigenous companies throughout the Company law requires the Directors to prepare financial state- region. Taking job losses into account, the net effect is that ments for each financial year which give a true and fair view of 698 jobs were lost in the region with employment levels in the state of affairs of the Company and the Group and of the companies assisted by Shannon Development totalling profit or loss of the Group for that period. In preparing those 21,351 at December 2001 - a 3.2 % reduction of the 2000 financial statements, the Directors are required to: level of 22,049. This is the first decline in overall employment figures since December 1993. • Select suitable accounting policies and then apply them consistently; • Employment at the Free Zone reduced by less than 1% while the indigenous sector suffered a 4.3 % loss. The Free Zone • Make judgements and estimates that are reasonable and was cushioned from the severity of the general downturn in prudent; the ICT sector, and the events of September 11th and their • State whether applicable accounting standards have been impact on the aviation sector, by the fact that the 126 com- followed, subject to any material departures disclosed and panies located there operate across a diverse range of busi- 32 explained in the financial statements; ness sectors and markets. •Prepare the financial statements on the going concern basis • Indigenous companies faced a separate set of challenges – unless it is inappropriate to presume that the Company will the slow-down on the multinational side filtered down to the continue in business. indigenous sector, as many companies are sub-suppliers to Applicable accounting standards have been followed, subject to multinationals. Increased input costs also added competitive any material departures disclosed and explained in the financial pressures in the general manufacturing sector while the foot statements. The Directors are responsible for keeping proper and mouth crisis and BSE had a specific effect on the food books of account which disclose with reasonable accuracy at any sector. time the financial position of the Company and the Group and • The Shannon Development Knowledge Network – a unique enable them to ensure that the financial statements comply initiative creating a network of key technology locations in with the Companies Acts, 1963 to 2001 and the European the Shannon Region was launched by the Company in 2001. Communities (Companies: Group Accounts ) Regulations 1992. Five locations – the National Technology Park Limerick, Kerry They are also responsible for safeguarding the assets of the Technology Park, Tipperary Technology Park, Information Group and hence for taking reasonable steps for the prevention Age Park Ennis, and Birr Technology Centre will singularly and detection of fraud and other irregularities. and collectively work to bring business, education and innovation together, to create Ireland’s most dynamic and excit- ing world-class locations for living and working in the Books of Account knowledge age. The measures taken by the directors to secure compliance with • During 2001, the Company invested €1,340,000 the company's obligation to keep proper books of account are (IR£1,055,000) in high potential start-up projects throughout the use of appropriate systems and procedures and employment the region. A total of €418,000 (IR£329,000) has been of competent persons. The books of account are kept at realised on exits from five projects, and seven new ‘high Shannon Development, Shannon Town Centre, Shannon, Co. potential start up’ projects had equity packages approved Clare. amounting to €1,270,000 (IR£1million). • In 2001, Shannon Development set out its telecommunica- Principal Activities tions priorities for the Shannon Region and commenced a Shannon Development’s business is ‘Pioneering Regional new flagship project aimed at addressing the digital divide Development for the Knowledge Age’. This mission is achieved between the region and the East Coast. The Company’s priorities include promoting the rollout of additional national \through the application of a number of key principles: carrier neutral infrastructure to facilitate carriers gaining • Strategic Leadership access to the region, attracting a Global Carrier into the • Innovative Action Region, and developing a Regional Ducting Backbone to link • Knowledge Age Activity together all enterprise clusters in the region and help promote competition between operators. • Spatial Development • Shannon Development invested €11.4 million (IR£9 million) • Economic Inclusion in the provision of infrastructure to aid economic develop- The key responsibilities of the Company include the development throughout the region. The Company’s investment was ment and promotion of Shannon Free Zone, indigenous indus- instrumental in leveraging over €25 million (IR£20m) of pri- try development in the Shannon Region, development of the vate sector investment in industrial and commercial facilities Knowledge Network throughout the region, development of in the region in 2001. the tourism industry in the Region, development of the • 2001 was an extremely difficult year for Irish Tourism. For the Industrial and Tourism infrastructure, and Rural and Local first time in 10 years tourism numbers and revenue declined, Development. due primarily to Foot and Mouth Disease (FMD) and the

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REPORT OF THE DIRECTORS

tragic events of September 11th. FMD had a deep impact on Subsidiaries and Related Companies tourism across all regions and sectors, but particularly in rural The information required by Section 158 (4) of the Companies areas and the activity holiday sectors. Act, 1963 is shown in Note 33 to the financial statements. • The terrorist atrocities in the United States on September 11th had an immediate adverse impact on travel worldwide, and also had immediate and long term consequences for Future Developments tourism in the Shannon Region. The Company will continue to focus on researching, concepting and pilot testing a range of innovative actions that will gener- • In response to FMD, Shannon Heritage, the wholly owned ate regional competitiveness and accelerate economic develop- subsidiary of Shannon Development, rapidly put in place a ment. If successful, these actions can be mainstreamed and range of precautionary measures at their own attractions delivered by others at regional, national and international level. which allowed the company to offer partial or full experiences at its visitor attractions and entertainments portfolio. Shannon Development continues to place a high priority on the These efforts also allowed Shannon Heritage to be the first to creation of an enabling environment for entrepreneurs and fully re-open to visitors. businesses that can generate globally competitive and knowl- • Shannon Development quickly produced two special compre- edge based enterprises which generate significant wealth for hensive visitor guides to the Shannon Region, the first in time shareholders, employees, suppliers, the community and other for St. Patrick’s Day 2001 giving overseas visitors information key stakeholders in the Shannon region. Shannon Development’s future focus will be on identifying the critical on all that they could do, see and enjoy in the Region, while 33 advising them of the precautions they should take. The needs or obstacles to regional development, and on leading and guides were distributed free through the Shannon encouraging the identification and development of solutions. Development Tourist Information Network and the accommodation sector. Health and Safety • In response to September 11th, a new Shannon and the West The well-being of the Group’s employees is safeguarded by Tourism Action Force, comprising a broad range of Shannon adherence to the requirements of the Safety, Health and Region and West of Ireland tourism interests, was established Welfare at Work Act, 1989. by Shannon Development to undertake positive actions to increase business into the Shannon Region and the West of € Ireland. A 1.5 million (IR£1.18 million) action plan has been Prompt Payment of Accounts Act, 1997 drawn up for all the major markets including the domestic Shannon Development comes under the remit of the Prompt market, Britain, North America and Europe and implementa- Payment of Accounts Act 1997, which came into effect on 2 tion has begun. January 1998. The following is the report of the Company for • Over the five year period of the last Operational Programme the period 1 January, 2001 to 31 December, 2001 in accordance for Tourism, Shannon Development secured €26.19m with the requirements as set out in schedule 12 of the Act: (IR£20.625m) in grant aid for some 75 projects involving a capital investment of €131.02m (IR£103.19m) throughout the • It is the policy of Shannon Development to ensure that all Region. The successful conclusion of the Programme enabled invoices are paid promptly. Specific systems are in place in the the Company, in partnership with the tourism trade, to Finance Department that will enable it to trace all invoices address many of the strategic gaps in the Region’s product and ensure that payment is made before the due date for portfolio, and to put in place new facilities to take advantage interest purposes. Invoices are logged daily and payment runs of emerging market opportunities. are carried out twice monthly to ensure prompt payment. • Shannon Development’s tourism subsidiary, Shannon • The total number of late payments in the period 1 January, Heritage, like many businesses in the tourism sector experi- 2001 to 31 December, 2001 was 457 invoices, the value of enced a very difficult year. Over 630,000 visitors attended these invoices was €1,286,317 (IR£1,013,057). The average Shannon Heritage’s range of eight day visitor attractions and number of calendar days by which payments were late was three evening entertainments, down 12% on the 2000 fig- 32 days. ures (which was one of the best results in the company’s 41 • The overall proportion of which late payments constituted year history). During the year the company continued to total payments made by Shannon Development was 3.36%. expand its range of product attractions, and in June added a The amount of interest incurred in the period 1 January, 2001 major new feature, the HB House, to its Bunratty Folk Park to 31 December, 2001 was €5,628 (IR£4,432). attraction in Co. Clare.

Results, Reserves and Dividends Board of Directors Operating deficit for the year €2,860,000 IR£2,252,000 The names of persons who were Directors at any time during the year ended 31 December 2001 are set out below. Re-nominalisation of share capital €38,000 IR£31,000 –––––––––– ––––––––––– L. McElligott (Chairman) € Decrease in Reserves 2,898,000 IR£2,283,000 R. Carroll P. Collins Details of the results for the year are set out in the Consolidated B. Dineen Income and Expenditure account on page 38, the Consolidated N. Foran Balance Sheet on page 40, and in the related notes. K. Grace As in previous years, it is not proposed to pay a dividend. F. Keane-Carmody

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REPORT OF THE DIRECTORS

W. Loughnane P. O'Brien B. O'Connell P. Schutz M. Stack E.M. Walsh Company Secretary: S. Fitzgibbon

In accordance with Article 75 of the Articles of Association, B. Dineen and R. Carroll retired by rotation in May 2001 and R. Carroll was reappointed. S. Gorman retired in April 2001.

The Minister for Enterprise, Trade and Employment in accordance with Article 77, and after consultation with the Minister for Finance and the Minister for Tourism, Sport and Recreation, appointed K. Grace in April 2001, F. Keane-Carmody in June 2001, and P. Schutz in July 2001.

34 J. Bourke resigned as Company Secretary in February 2001, and S. Fitzgibbon was appointed.

Auditors The Comptroller and Auditor General continues in office in accordance with the Company's Articles of Association, and Section 5((1)(a)(i)) of the Comptroller and Auditor General (Amendment) Act, 1993.

Signed: L. McElligott

Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 REPORT OF THE COMPTROLLER AND AUDITOR GENERAL

Report of the Comptroller and Auditor General Report of the Comptroller and Auditor General for presentation to the Houses of the Oireachtas pursuant to Section 13 of the Prompt Payment of Accounts Act, 1997 I have audited the financial statements on pages 33 to 64 under Section 5 of the Comptroller and Auditor General (Amendment) Act, 1993. Responsibilities of the Company and of the Comptroller and Auditor General The company is obliged to comply with the Act and, in particu- Respective responsibilities of the Directors and of the lar, is required Comptroller and Auditor General The accounting responsibilities of the directors are set out in the • to pay its suppliers by the appropriate payment date; Directors' Report on pages 32 to 34. It is my responsibility, based on • if payment to a supplier is late, to include the appropriate my audit, to form an independent opinion on the financial state- penalty interest with the payment together with the infor- ments presented to me by the directors and to report on them. mation required by Section 6; • to disclose its payment practices in the period in the appro- Basis of Audit Opinion priate way. In the exercise of my function as Comptroller and Auditor General, I conducted my audit of the financial statements in Under Section 13 of the Act, it is my responsibility, as auditor of accordance with auditing standards issued by the Auditing Shannon Free Airport Development Company Limited, to report Practices Board and by reference to the special considerations on whether, in all material respects, the company has complied 35 which attach to State bodies in relation to their management with the provisions of the Act. and operation.

An audit includes examination, on a test basis, of evidence rele- Basis of Opinion vant to the amounts and disclosures in the financial statements. My examination included a review of the payment systems and It also includes an assessment of the significant estimates and procedures in place and checking, on a test basis, evidence relat- judgments made in the preparation of the financial statements, ing to the operation of the Act by the company during the year. and of whether the accounting policies are appropriate to the Company's circumstances, consistently applied and adequately I obtained all the information and explanations which I consid- disclosed. ered necessary for the exercise of my function under Section 13 of the Act. I planned and performed my audit so as to obtain all the information and explanations that I considered necessary to provide In its administration of prompt payment procedures, the me with sufficient evidence to give reasonable assurance that the Company takes the date of processing of a payment as the date financial statements are free from material misstatement of actual payment rather than the date on which payment is whether caused by fraud or other irregularity or error. In forming made. On that basis the Company has calculated that late pay- my opinion also evaluated the overall adequacy of the presenta- ments represented 3.36% of total payments made by it during tion of information in the financial statements. the year.

Opinion In my opinion, the financial statements give a true and fair view of Opinion the state of affairs of the Company and the Group at 31 December As a result of my examination, it is my opinion that the company 2001 and of the deficit and cash flow of the Group for the year then did not comply in all material respects with the provisions of the ended and have been properly prepared in accordance with the Act during the year ended 31 December 2001. Companies Acts, 1963 to 2001 and the European Communities (Companies: Group Accounts) Regulations, 1992. John Purcell Comptroller and Auditor General I obtained all the information and explanations that I required 15 May, 2002 for the purposes of my audit. In my opinion, proper books of account have been kept by the Company and the balance sheet of the Company is in agreement with them.

In my opinion, the information given in the Report of the Directors is consistent with the financial statements.

The net assets of the Company, as stated in the balance sheet, are more than half of the amount of its called up share capital and, in my opinion, on that basis there did not exist, at 31 December 2001, a financial situation which, under Section 40 of the Companies (Amendment) Act, 1983, would require the con- vening of an extraordinary general meeting of the Company.

John Purcell Comptroller and Auditor General 14 May, 2002

SHANNON DEVELOPMENT ANNUAL REPORT 2001 ACCOUNTING POLICIES

Accounting policies Stocks Stocks are stated at the lower of cost and net realisable value. Basis of Accounting Cost is based on purchase price on a first in, first out basis. Net The financial statements have been prepared in accordance with realisable value is based on estimated selling price less all fur- the historical cost convention in the form approved by the ther costs to completion and less all costs incurred in marketing, Minister for Enterprise, Trade and Employment with the concur- selling and distribution. Provision is made for obsolete, slow rence of the Minister for Finance under the Shannon Free moving or defective items, where appropriate. Airport Development Company Limited Act, 1959 as amended, and in accordance with the Companies Acts 1963 to 2001 and European Communities (Companies: Group Accounts) Tangible Assets and Depreciation Regulations 1992. The major portion of the Group's assets have been developed or constructed for the purposes of assisting in the promotion of The format of these financial statements complies with the industry and tourism. They are not considered to be investment required format set out in Companies (Amendment) Act 1986, properties but normal fixed assets. As a result freehold land and subject to certain departures from the standard format of the buildings are stated at cost less accumulated depreciation on Income and Expenditure account which are necessary to give a buildings. Other tangible assets are stated at cost less accumu- true and fair presentation of the results of the Group. lated depreciation.

The original cost of buildings is inclusive of the appropriate 36 The financial statements are prepared on an accruals basis, except as stated below and in accordance with Generally amount of infrastructure costs associated with those buildings Accepted Accounting Practice. Financial Reporting Standards and is depreciated on the same basis as those buildings. recommended by the recognised accountancy bodies are adopted as they become applicable. Details of depreciation rates are set out in Note 14 to the financial statements.

Basis of Consolidation Construction Work in Progress is stated at cost and relates to The consolidated financial statements comprise the financial capital expenditure on construction projects that have not been statements of the Company and its subsidiary companies, completed at the year end. together with the Group's share of the results of related companies. Where accounting policies followed by subsidiary or related companies differ significantly from those adopted for Financial Assets the purposes of the consolidated financial statements, appropri- Financial assets comprise investments and loans and are stated ate adjustments are made to ensure a consistent basis of at cost less provision for any diminution in value. Provision is accounting. No such adjustments were required in the current determined by in house investment specialists on attributable year. net asset value based on audited or management accounts and any other relevant information available.

Income Recognition Income from Oireachtas grants, grant refunds, the European Currencies Social Fund, the European Regional Development Fund and The unit of currency in which the financial statements are Investments represent actual cash receipts in the year. denominated is the Euro. Comparative Irish Pound figures are displayed for information purposes only.

Capital Reserve Monetary assets and liabilities denominated in foreign curren- Exchequer funding received by the Company for the purpose of cies are translated at the exchange rate ruling at the balance acquisition of fixed assets and equity investments are treated as sheet date and revenues, costs and non-monetary assets at the a capital contribution and included in Shareholders’ funds. exchange rates ruling at the dates of the transactions. The resulting gains or losses are dealt with through the Income and Expenditure Account. Deferred Income EU and other grants received in respect of the purchase of fixed assets are treated as a deferred credits, and are amortised to the Superannuation Schemes income and expenditure account annually over the useful eco- Superannuation benefits are conferred by pension schemes nomic life of the asset to which they relate. made under the provisions of Section 5 of the Schedule to the Shannon Free Airport Development Company Limited Act, 1959.

Leases Contributions to these Schemes are dealt with in the Income and Expediture incurred under operating leases is charged to the Expenditure Account on an accruals basis. The contributions are Income and Expenditure Account. Assets held for rent under based on the advice of a professionally qualified actuary and are operating leases are included in Tangible Assets at cost less accu- included as staff costs in the Income and Expenditure Account. mulated depreciation. The rental income earned from the leas- ing of these assets is accounted for as income in the Income and Post retirement pension increases are paid by the Company from Expenditure Account on the accruals basis. current income as they arise in accordance with directions from the Department of Finance. No provision has been made in

SHANNON DEVELOPMENT ANNUAL REPORT 2001 ACCOUNTING POLICIES

respect of future liabilities in relation to such post retirement pension increases. In the event that the Company is unable to fund this liability in future years, any shortfall will be funded by the Exchequer.

The disclosures required under the transitional arrangements of Financial Reporting Standards No. 17 ‘Retirement Benefits’ for the year ended 31 December, 2001 are shown in Note 28.

Bad and Doubtful Debts Provision is made in respect of doubtful debts in relation to amounts due from industrial, housing, commercial tenants and diminution in value of loans, investments and deferred debtors.

Taxation Taxation is calculated on taxable profits, after adjusting for non- taxable items at the current corporation tax rates. Details of taxable profits are set out in Note 11 to the financial statements. 37

Liquid Resources Liquid resources are current asset investments, which are held as readily disposable stores of value. Liquid resources include deposits of less than one year.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT

Consolidated Income and Expenditure Account Year ended 31 December, 2001

Notes 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated)

Income Grants 2 10,109 36,859 7,961 29,029 Rental 20,441 19,187 16,099 15,111 Tourism Activities 11,639 12,172 9,166 9,586 EU/ Consultancy Income 1,233 2,972 971 2,340 ––––––– ––––––– ––––––– ––––––– Total Group Income 43,422 71,190 34,197 56,066 Grants Expenditure 2 (11,063) (35,922) (8,711) (28,291) 38 Direct Property Expenditure 5 (13,777) (12,870) (10,850) (10,136) Direct Cost of Sales - Tourism Activities (4,050) (4,340) (3,189) (3,418) ––––––– ––––––– ––––––– ––––––– Gross Surplus 14,532 18,058 11,447 14,221

Other Operating Expenses 6 (27,622) (27,452) (21,754) (21,621) Other Operating Income 7 4,208 4,330 3,314 3,410 Less: Share of Operating Income of joint ventures and associates (313) (453) (247) (357) ––––––– ––––––– ––––––– ––––––– Group Operating (Deficit) 8 (9,195) (5,517) (7,240) (4,347) Share of Operating loss of joint ventures and associates (137) (32) (108) (25) ––––––– ––––––– ––––––– ––––––– (9,332) (5,549) (7,348) (4,372) Profit on sale of assets 5,933 9,353 4,672 7,366 ––––––– ––––––– ––––––– ––––––– (Deficit)/ Surplus on ordinary activities before interest (3,399) 3,804 (2,676) 2,994 Income from Financial Assets 10 504 298 397 235 Interest receivable 622 668 489 526 ––––––– ––––––– ––––––– –––––––

(Deficit)/ Surplus on ordinary activities before tax (2,273) 4,770 (1,790) 3,755

Tax on surplus on ordinary activities 11 (587) (1,094) (462) (861) ––––––– ––––––– ––––––– ––––––– (Deficit)/ Surplus retained for the financial year (2,860) 3,676 (2,252) 2,894 ––––––– ––––––– ––––––– –––––––

Income and operating profits arose solely from continuing operations. There were no recognised gains and losses other than those dealt with in the income and expenditure account. The accounting policies and notes 1 to 43 form part of these Financial Statements

Signed: L. McElligott Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 STATEMENT OF MOVEMENT IN RETAINED SURPLUSES

Statement of Movement in Retained Surpluses

Note 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Balance at 1 January (as previously stated) (50,030) 8, 906 (39,401) 7,014 Prior Year Adjustment 12 0 (62,612) 0 (49,309) ––––––– ––––––– ––––––– ––––––– (50,030) (53,706) (39,401) (42,295)

(Deficit)/ Surplus for year (2,860) 3,676 (2,252) 2,894 Renominalisation of share capital (38)0(31)0 ––––––– ––––––– ––––––– ––––––– Balance at 31 December (52,928) (50,030) (41,684) (39,401) ––––––– ––––––– ––––––– –––––––

The accounting policies and notes 1 to 43 form part of these Financial Statements

Signed: L. McElligott Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 CONSOLIDATED BALANCE SHEET

Consolidated Balance Sheet At 31 December, 2001

Notes 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated) Fixed Assets Tangible Assets 14 162,529 160,059 128,004 126,057 Financial Assets 15 13,008 13,537 10,244 10,661 ––––––– ––––––– ––––––– ––––––– 175,537 173,596 138,248 136,718 Current Assets Stocks 18 680 690 536 543 Debtors 19 7,194 6,144 5,665 4,839 Bank and cash balances 16,907 23,064 13,315 18,164 40 ––––––– ––––––– ––––––– ––––––– 24,781 29,898 19,516 23,546

Current Liabilities Creditors (Amounts falling due within one year) 20 (11,861) (13,122) (9,342) (10,335) ––––––– ––––––– ––––––– –––––––

Net Current Assets 12,920 16,776 10,174 13,211

Creditors Amounts falling due after more than one year 21 (11,116) (11,423) (8,754) (8,996) Deferred Income 22 (5,851) (6,047) (4,608) (4,762) ––––––– ––––––– ––––––– ––––––– (16,967) (17,470) (13,362) (13,758)

Net Assets 171,490 172,902 135,060 136,171 ––––––– ––––––– ––––––– –––––––

Capital and Reserves Called up Share Capital 23 183,396 183,294 144,437 144,356 Capital Reserve 24 41,022 39,638 32,307 31,216 Reserves 25 (52,928) (50,030) (41,684) (39,401) ––––––– ––––––– ––––––– ––––––– Equity shareholders’ funds 26 171,490 172,902 135,060 136,171 ––––––– ––––––– ––––––– –––––––

The accounting policies and notes 1 to 43 form part of these Financial Statements

Signed: L. McElligott Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY BALANCE SHEET

Company Balance Sheet At 31 December, 2001

Notes 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated) Fixed Assets Tangible Assets 14 162,426 159,949 127,921 125,970 Financial Assets 15 13,387 13,791 10,543 10,861 ––––––– ––––––– ––––––– ––––––– 175,813 173,740 138,464 136,831

Current Assets Stocks 18 213 199 170 156 Debtors 19 7,047 6,034 5,550 4,752 Bank and cash balances 15,848 21,363 12,481 16,825 41 ––––––– ––––––– ––––––– ––––––– 23,108 27,596 18,201 21,733

Current Liabilities Creditors (Amounts falling due within one year) 20 (11,403) (12,234) (8,981) (9,635) ––––––– ––––––– ––––––– ––––––– Net Current Assets 11,705 15,362 9,220 12,098

Net Assets 170,551 171,632 134,322 135,171 ––––––– ––––––– ––––––– –––––––

Capital and Reserves Called up Share Capital 23 183,396 183,294 144,437 144,356 Capital Reserve 24 41,022 39,638 32,307 31,216 Reserves 25 (53,867) (51,300) (42,422) (40,401) ––––––– ––––––– ––––––– ––––––– Equity shareholders’ funds 26 170,551 171,632 134,322 135,171 ––––––– ––––––– ––––––– –––––––

The accounting policies and notes 1 to 43 form part of these Financial Statements

Signed: L. McElligott Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 CONSOLIDATED CASH FLOW STATEMENT

Consolidated Cash Flow Statement For the year ended 31 December, 2001

Notes 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated)

Net cash (outflow)/inflow from operating activities 27(a) (1,474) 1,446 (1,158) 1,139

Returns on investments and servicing of finance 27(b)(i) 1,126 966 886 761

Taxation (Paid) (204) (154) (161) (121)

Capital expenditure and financial investment 27(b)(ii) (6,795) 877 (5,353) 690 42 ––––––– ––––––– ––––––– ––––––– Net cash (outflow)/inflow before the use of liquid resources (7,347) 3,135 (5,786) 2,469

Financing 27(b)(iii) 1,190 2,694 937 2,121 ––––––– ––––––– ––––––– ––––––– (Decrease)/Increase in Cash 27(c) (6,157) 5,829 (4,849) 4,590 ––––––– ––––––– ––––––– –––––––

The accounting policies and notes 1 to 43 form part of these Financial Statements.

Signed: L. McElligott Signed: R. Carroll

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Notes to the Consolidated Financial Statements

1. Segmental Information There are no significant segments within the Group’s operations which would warrant disclosure of segmental information.

2. Grant Income and Expenditure 2001 2000 2001 2000 €000 €000 IR£000 IR£000 a) Grant Income By Class of Activity: Oireachtas Grants: Grant-in-Aid - Running Expenses 938 1,069 739 842 Grant-in-Aid - Grants to Industries 467 4,131 368 3,253 Capital Development Works - Grants 0 91 0 72 Grants from IDA Ireland and Enterprise Ireland 4,405 23,038 3,469 18,144

Other Grants: 43 Specific Measures 1,938 4,167 1,526 3,282 ERDF Operational Programmes for Tourism 2,361 4,363 1,859 3,436 ––––––– ––––––– ––––––– ––––––– 10,109 36,859 7,961 29,029 ––––––– ––––––– ––––––– –––––––

b) Grants Expenditure Grants to Industries (note 3) 6,764 27,301 5,326 21,501 Specific Measures (note 4) 1,938 4,167 1,526 3,282 Capital Development Works 0 91 0 72 ERDF Operational Programmes for Tourism 2,361 4,363 1,859 3,436 ––––––– ––––––– ––––––– ––––––– 11,063 35,922 8,711 28,291 ––––––– ––––––– ––––––– –––––––

3. Grants to Industries 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (a) Shannon Free Zone Plant and Machinery 51 191 40 151 Buildings 27 56 21 44 Training Workers 383 325 302 256 Rent Reduction 372 771 293 607 Employment 1,226 2,292 966 1,805 Feasibility Study 0 32 0 25 ––––––– ––––––– ––––––– ––––––– 2,059 3,667 1,622 2,888 Administration Expenses 299 330 235 260 ––––––– ––––––– ––––––– ––––––– 2,358 3,997 1,857 3,148 ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(b) Grants paid under Section 12(3) of the Industrial Development Act 1986 and Section 9(3) of the Industrial Development Act 1993. 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Plant and Machinery 444 2,079 350 1,637 Buildings 646 1,458 509 1,148 Training Workers 703 1,517 553 1,195 Rent Reduction 12 170 9 134 Research and Development 207 0 163 0 Feasibility Study 414 378 326 298 Employment 1,562 17,702 1,230 13,941 E-business 382 0 301 0 Market Development Support 17 0 13 0

44 Strategy Consultant 19 0 15 0 ––––––– ––––––– ––––––– –––––– 4,406 23,304 3,469 18,353 ––––––– ––––––– ––––––– –––––––

Total Grants to Industries Expenditure 6,764 27,301 5,326 21,501 ––––––– ––––––– ––––––– –––––––

Opening Balance Receipts Payments Closing Balance 4. Specific Measures €000 IR£000 €000 IR£000 €000 IR£000 €000 IR£000

Industry R&D 4 3 197 155 (201) (158) 0 0 Small Business Operational Programme 0 0 249 196 (249) (196) 0 0 Change Programme 0 0 52 41 (52) (41) 0 0 R&D Measure 3 2 2 108 85 (110) (87) 0 0 Research, Technology and Innovation Initiative 5 4 1,314 1,035 (1,235) (973) 84 66 New Community Enterprise Centre 0 0 18 14 (18) (14) 0 0 –––– –––– ––––– ––––– –––––– –––––– –––– –––– 11 9 1,938 1,526 (1,865) (1,469) 84 66 –––– –––– ––––– ––––– –––––– –––––– –––– ––––

Specific Measures are funded by the EU and are administered nationally by Enterprise Ireland. Shannon Development has responsibility for these payments in the Shannon Region.

The charge to the Income and Expenditure Account for the year is as follows:

2001 2000 2001 2000 €000 €000 IR£000 IR£000

Opening Creditor (11) (18) (9) (14) Total Payments on Specific Measures 1,865 4,174 1,469 3,287 Closing Creditor 84 11 66 9 ––––– ––––– ––––– ––––– 1,938 4,167 1,526 3,282 ––––– ––––– ––––– –––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

5. Direct Rental Property Expenses 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Staff Costs 1,488 1,405 1,172 1,106 Repairs, Maintenance and Services 3,741 3,313 2,946 2,609 Rent, Rates and Insurance 991 927 783 730 Light, Heat and Power 596 561 470 442 Provision for Bad and Doubtful Debts 179 193 141 152 Administration Expenses 877 674 690 531 Depreciation 5,905 5,797 4,648 4,566 ––––––– ––––––– ––––––– ––––––– 13,777 12,870 10,850 10,136 ––––––– ––––––– ––––––– –––––––

6. Other Operating Expenses 2001 2000 2001 2000 45 €000 €000 IR£000 IR£000

Industrial and Tourism Promotion (i) 13,034 13,277 10,265 10,456 Administrative Expenses (ii) 11,897 10,563 9,369 8,319 Impairment of Investments and Loans 1,676 876 1,320 690 Other Operating Expenses 364 573 287 425 Write off of assets 0 1,551 0 1,222 Amortisation of Capital Grants (247) (245) (194) (193) Depreciation 898 857 707 702 ––––––– ––––––– ––––––– ––––––– 27,622 27,452 21,754 21,621 ––––––– ––––––– ––––––– –––––––

(i) Industrial and Tourism Promotion Staff Costs 6,920 6,678 5,450 5,259 Other 6,114 6,599 4,815 5,197 ––––––– ––––––– ––––––– ––––––– 13,034 13,277 10,265 10,456 ––––––– ––––––– ––––––– –––––––

(ii) Administrative Expenses Staff Costs 6,553 7,237 5,160 5,700 Other 5,344 3,326 4,209 2,619 ––––––– ––––––– ––––––– ––––––– 11,897 10,563 9,369 8,319 ––––––– ––––––– ––––––– –––––––

7. Other Operating Income 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Miscellaneous Property Income 551 371 433 292 Water Charges 1,408 1,335 1,109 1,051 Grant Repayments 236 37 186 29 Miscellaneous Income 1,700 2,134 1,339 1,681 Share of Associates’ Operating Income 313 453 247 357 ––––––– ––––––– ––––––– ––––––– 4,208 4,330 3,314 3,410 ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

8. The Deficit on Ordinary Activities before Taxation has been arrived at after charging/(crediting):

2001 2000 2001 2000 €000 €000 IR£000 IR£000

Depreciation 6,803 6,688 5,355 5,268 Director’s Remuneration (i) 117 53 92 42 Auditor’s Remuneration 54 51 42 40 Exceptional Item (ii) (217)0(171)0

(i) Director’s remuneration comprises emoluments for services as director.

(ii) During the year a review was carried out on the manner in which certain activities were treated for value added tax purposes. As a result the following adjustments arose:

(a) A net recovery was realised in respect of property expenses in the amount of €499,000 (IR£393,000). This is offset against direct property expenses in the income and expenditure account.

46 (b) Profits previously recognised on sales of fixed assets were reduced by €282,000(IR£222,000).

The net result of items (a) and (b) above, resulted in a total net saving being taken into the income and expenditure account of €217,000 (IR£171,000).

(c) Further recoveries were realised on items of capital expenditure amounting to €985,000 (IR£776,000). These are reflected in the cost of the underlying fixed assets (See Note 14).

9. Employment 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Staff Costs: Wages and Salaries 13,484 12,641 10,620 9,956 Social Welfare Costs 1,226 1,145 966 902 Pension Costs 1,687 1,326 1,329 1,044 –––––– –––––– –––––– –––––– 16,397 15,112 12,915 11,902 –––––– –––––– –––––– ––––––

The average number of persons employed by the Group is 419 (2000: 420):

Category Number of Persons Industrial Development 65 General Administration 90 Property 27 Tourism 237 ––––– 419 –––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

10. Income from Financial Assets 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Dividend Income 447 236 352 186 Fee Income 57 62 45 49 ––––– ––––– ––––– ––––– 504 298 397 235 ––––– ––––– ––––– –––––

11. Taxation 2001 2000 2001 2000 €000 €000 IR£000 IR£000

Share of taxation of subsidiaries (2) (73) (2) (57) Corporation taxation charge of parent company (471) (878) (371) (691) Irrecoverable DIRT (114) (143) (89) (113) 47 ––––– ––––– ––––– ––––– (587) (1,094) (462) (861) ––––– ––––– ––––– –––––

The holding Company's taxation position was amended in the Finance Act 1994. The Company is liable to corporation tax in respect of any surpluses on its Case 1 and 2 activities. Income from other sources is exempt from corporation tax. Pending final determination by the Revenue Commissioners, a provision has been made in the Financial Statements for a Company liability to corporation tax of €471,000 (IR£371,000) for the year ended 31 December, 2001 in respect of activities that may be regarded as trading activities.

Deposit Interest Retention Tax of €114,000 (IR£89,000) was paid in 2001.

The rates of taxation applicable to the Company and its subsidiaries range from 20% to 25% (2000 24% to 25%). As noted above, taxation is only charged in respect of Case 1 and Case 2 activities of the holding company.

12. Prior Year Adjustment In light of the changing legislative and regulatory environments in recent times and the growing diversity of the group’s activities, a detailed review of the Group’s financial statements was carried out. As a Semi-State body, in the past, certain items of income and expenditure were treated as capital reserve movements to reflect the capital nature of these transactions in accordance with the manner in which the Company's parent Department differentiates between Revenue and Capital funding. As a result of this review, the Company has decided to change its treatment of capital and revenue items to more accurately reflect the changing nature of the activities within the Group.

Accordingly, certain items of income and expenditure which have been reflected in capital reserves and unfunded depreciation in the past will now be reflected in the income and expenditure and in revenue reserves. A new note is included in the financial statements (Note 25) which provides an analysis of reserves which distinguishes between items of a revenue or capital nature in the context in which the Company's parent Department differentiates between revenue and capital funding. In this context the revenue reserves, capital reserves and unfunded depreciation reserves have been re-stated.

In addition, the Group has changed its accounting policy in respect of contributions received towards acquisition of fixed assets and equity investments, and capital grants received from EU and other sources.

Capital grants are now being treated as deferred credits and amortised in the income and expenditure account on the same basis as the related assets are depreciated. The company has also adopted a policy of treating exchequer funding received for the purpose of acquisition of fixed assets and equity investments as a capital reserve which is included as part of shareholders' funds. The prior year adjustment also reflects these changes in accounting policies.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The prior adjustment and restated opening reserves for the group are as follows:

Revenue Capital Unfunded Transfer Total Depreciation to Income €000 €000 €000 €000 €000 Reserves at 1 January, 2000 As previously stated 8,906 70,519 (87,050) (1,028) (8,653)

Prior Year Adjustment Transfers to Total Reserve (62,612) (25,466) 87,050 1,028 0 Capital Reserve (i) – (38,861) – – (38,861) Deferred Income (ii) – (6,192) – – (6,192) ––––––– ––––––– ––––––– ––––––– ––––––– Reserves at 1 January, 2000 as restated (53,706) 0 0 0 (53,706) ––––––– ––––––– ––––––– ––––––– –––––––

48 Revenue Capital Unfunded Transfer Total Depreciation to Income IR£000 IR£000 IR£000 IR£000 IR£000 Reserves at 1 January, 2000 As previously stated 7,014 55,538 (68,557) (810) (6,815)

Prior Year Adjustment Transfers to Total Reserve (49,309) (20,058) 68,557 810 0 Capital Reserve (i) – (30,604) – – (30,604) Deferred Income (ii) – (4,876) – – (4,876) ––––––– ––––––– ––––––– ––––––– ––––––– Reserves at 1 January, 2000 as restated (42,295) 0 0 0 (42,295) ––––––– ––––––– ––––––– ––––––– –––––––

(i) Grant income received by the company from the exchequer is regarded as a form of a capital contribution to the company and will be maintained as part of the capital of the company, without amortisation.

(ii) Grants received from other sources towards the cost of assets are treated in accordance with the provisions of Statement of Standard Accounting Practice 4, and recorded as deferred income on receipt and amortised to the income and expenditure account on the same basis as the related assets are depreciated.

13. Retained Deficit for Financial Year The amount of the deficit attributable to Group shareholders dealt with in the financial statements of the holding company (Shannon Free Airport Development Company Limited) was €2,529,000 (IR£1,990,000) (2000 as restated: Surplus €3,370,000 (IR£2,652,000)).

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

14. Tangible Assets

Euro Industrial Land & Shannon Town Tourist Land & Construction Fixtures Total Buildings & Services Buildings Work in Progress Fittings & Equipment €000 €000 €000 €000 €000 €000 (a) Group Cost As at 1 January 2001 179,534 22,224 21,976 15,257 4,199 243,190 Additions 3,250 0 0 11,801 1,006 16,057 Disposals (7,454) (198) 0 0 (2) (7,654) Transfers 10,717 117 901 (11,911) 176 0 Adjustment (See Note 8) (390) (34) 0 (561) 0 (985) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 185,657 22,109 22,877 14,586 5,379 250,608 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– 49

Accumulated Depreciation As at 1 January 2001 63,252 13,419 4,021 0 2,439 83,131 Charged 4,971 386 555 0 891 6,803 Disposals (1,798) (57) 0 0 0 (1,855) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 66,425 13,748 4,576 0 3,330 88,079 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2001 119,232 8,361 18,301 14,586 2,049 162,529 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2000 116,282 8,805 17,955 15,257 1,760 160,059 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

(b) Company Cost As at 1 January 2001 179,534 22,224 21,807 15,257 3,857 242,679 Additions 3,250 0 0 11,801 1,006 16,057 Disposals (7,454) (198) 0 0 (2) (7,654) Transfers 10,717 117 901 (11,911) 176 0 Adjustment (See Note 8) (390) (34) 0 (561) 0 (985) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 185,657 22,109 22,708 14,586 5,037 250,097 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

Accumulated Depreciation As at 1 January 2001 63,252 13,419 3,962 0 2,097 82,730 Charged 4,971 386 548 0 891 6,796 Disposals (1,798) (57) 0 0 0 (1,855) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 66,425 13,748 4,510 0 2,988 87,671 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2001 119,232 8,361 18,198 14,586 2,049 162,426 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2000 116,282 8,805 17,845 15,257 1,760 159,949 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

14. Tangible Assets (continued)

Irish Pounds Industrial Land & Shannon Town Tourist Land & Construction Fixtures Total Buildings & Services Buildings Work in Progress Fittings & Equipment

IR£000 IR£000 IR£000 IR£000 IR£000 IR£000 (a) Group

Cost As at 1 January 2001 141,395 17,503 17,308 12,015 3,307 191,528 Additions 2,560 0 0 9,294 792 12,646 Disposals (5,871) (156) 0 0 (2) (6,029) Transfers 8,440 92 710 (9,381) 139 0 Adjustment (See Note 8) (307) (27) 0 (442) 0 (776) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 146,217 17,412 18,018 11,486 4,236 197,369 50 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

Accumulated Depreciation As at 1 January 2001 49,815 10,568 3,167 0 1,921 65,471 Charged 3,914 303 436 0 702 5,355 Disposals (1,416) (45) 0 0 0 (1,461) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 52,313 10,826 3,603 0 2,623 69,365 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2001 93,904 6,586 14,415 11,486 1,613 128,004 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2000 91,580 6,935 14,141 12,015 1,386 126,057 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

(b) Company

Cost As at 1 January 2001 141,395 17,503 17,174 12,015 3,038 191,125 Additions 2,560 0 0 9,294 792 12,646 Disposals (5,871) (156) 0 0 (2) (6,029) Transfers 8,440 92 710 (9,381) 139 0 Adjustment (See Note 8) (307) (27) 0 (442) 0 (776) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 146,217 17,412 17,884 11,486 3,967 196,966 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

Accumulated Depreciation As at 1 January 2001 49,815 10,568 3,120 0 1,652 65,155 Charged 3,914 303 432 0 702 5,351 Disposals (1,416) (45) 0 0 0 (1,461) ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– As at 31 December 2001 52,313 10,826 3,552 0 2,354 69,045 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2001 93,904 6,586 14,332 11,486 1,613 127,921 ––––––– ––––––– ––––––– ––––––– ––––––– ––––––– Net Book Value 2000 91,580 6,935 14,054 12,015 1,386 125,970 ––––––– ––––––– ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

14. Tangible Assets (continued)

As a result of the review carried out during the year as detailed in Note 12, the company has reclassified certain items of fixed assets under different headings.

Tangible assets (excluding land) are depreciated on a straight-line basis at the following rates:

Industrial and Tourist Buildings - Buildings 3% - Infrastructure 3%

Shannon Town and Services - Community Facilities 3% - Buildings 3% - Infrastructure 3% - Sanitary Services 5%

Fixtures, Fittings and Equipment - Motor Vehicles 20% - Office Furniture and Fittings 15% 51 - IT Equipment 331/3%

As at 31 December 2001 the gross amount of assets held for use in operating leases and related depreciation charges was €165,320,000 (IR£130,200,000) and €65,329,000 (IR£51,451,000) respectively.

The aggregate rental receivable for the year 2001 was €20,441,000 (IR£16,099,000).

15. Financial Assets

Group 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Interest in related companies: Share of net assets 282 363 222 286 Other investments (Note 16) 11,222 11,980 8,838 9,435 Loans (Note 17) 1,504 1,194 1,184 940 –––––– –––––– –––––– –––––– Total 13,008 13,537 10,244 10,661 –––––– –––––– –––––– –––––– Company Interest in subsidiary companies: Shares at cost 490 490 386 386 Interest in related companies: –––––– –––––– –––––– –––––– Shares at cost 182 138 144 109 Less: Provision against diminution in value (11) (11) (9) (9) –––––– –––––– –––––– –––––– 171 127 135 100 Other investments (Note 16) 11,222 11,980 8,838 9,435 Loans (Note 17) 1,504 1,194 1,184 940 –––––– –––––– –––––– –––––– Total 13,387 13,791 10,543 10,861 –––––– –––––– –––––– ––––––

Principal subsidiaries and related companies are listed on Note 33 to the financial statements.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

16. Other Investments 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Group and Company Cost At 1 January 14,648 18,533 11,538 14,596 Additions – Equity Investments 1,384 777 1,090 612 –––––– –––––– –––––– –––––– 16,032 19,310 12,628 15,208

Disposals Redemptions (271) (832) (213) (654) Write-off of bad debts previously provided for (827) (3,830) (651) (3,016) Transfer to loans (195)0(154)0 –––––– –––––– –––––– –––––– At 31 December 14,739 14,648 11,610 11,538 –––––– –––––– –––––– –––––– 52 Impairment Provision At 1 January (2,668) (5,542) (2,103) (4,365) Movement in year (849) 2,874 (669) 2,262 –––––– –––––– –––––– –––––– At 31 December (3,517) (2,668) (2,772) (2,103) –––––– –––––– –––––– –––––– Net Book Amount 11,222 11,980 8,838 9,435 –––––– –––––– –––––– ––––––

The investments are listed in Note 35, together with the market value of any quoted investments.

Financial assets comprise investments and loans and are stated at cost less provision for any diminution in value. Provision is determined on an attributable net asset value based on audited or management accounts and any other relevant information available.

17. Loans 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Group and Company House Loans (see (a) below) 198 268 156 211 Shannon Region Enterprise Fund (see (b) below) 333 365 262 287 Other Loans (see (c) below) 973 561 766 442 –––––– –––––– –––––– –––––– 1,504 1,194 1,184 940 –––––– –––––– –––––– ––––––

(a) House Loans In 1976, the Company introduced a House Loan Scheme to supplement its existing Tenant Purchase Scheme. Fifty five House Loans were outstanding at 31 December, 2001. The Loans are secured by means of a charge on the houses in question.

(b) Shannon Region Enterprise Fund This fund was established in 1988 to assist regional development projects in their initial years of trading. The Company maintains an involvement with projects benefiting from the fund. The investment is intended to be of a revolving nature.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

18. Stocks 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Group Goods for resale 660 676 520 532 Consumable Stocks 20 14 16 11 –––––– –––––– –––––– –––––– 680 690 536 543 –––––– –––––– –––––– ––––––

Company Goods for resale 194 185 154 145 Consumable Stocks 19 14 16 11 –––––– –––––– –––––– –––––– 213 199 170 156 –––––– –––––– –––––– –––––– 53 No significant differences exist between balance sheet stock values and replacement cost values.

19. Debtors 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Group Amounts falling due within one year Trade Debtors 6,258 5,263 4,927 4,145 Deferred Debtors (i) 7 15 6 12 Prepayments 544 518 428 408 Value Added Tax recoverable 360 317 284 250 –––––– –––––– –––––– –––––– 7,169 6,113 5,645 4,815

Amounts falling due after more than one year Deferred Debtors (i) 25 31 20 24 –––––– –––––– –––––– –––––– Total Debtors 7,194 6,144 5,665 4,839 –––––– –––––– –––––– ––––––

Company Amounts falling due within one year Trade Debtors 6,070 5,042 4,780 3,971 Amounts owed by Group Companies 326 452 257 356 Deferred Debtors (i) 7 15 6 12 Prepayments 281 193 221 152 Value Added Tax recoverable 338 301 266 237 –––––– –––––– –––––– –––––– 7,022 6,003 5,530 4,728

Amounts falling due after more than one year Deferred Debtors (i) 25 31 20 24 –––––– –––––– –––––– –––––– Total Debtors 7,047 6,034 5,550 4,752 –––––– –––––– –––––– ––––––

(i) Included in ‘Deferred Debtors’ are capital debtors arising from the sale of assets on a deferred payments basis.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20. Creditors 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Amounts falling due within one year Group Trade Creditors 1,819 1,223 1,433 963 Income Tax deducted under PAYE 236 276 186 217 Pay Related Social Insurance 127 121 100 95 Corporation Tax 1,898 1,498 1,495 1,180 Accruals and Other Liabilities 7,485 9,706 5,895 7,645 Repayable Advances (Note 21) 296 298 233 235 –––––– –––––– –––––– –––––– 11,861 13,122 9,342 10,335 –––––– –––––– –––––– ––––––

Company 54 Trade Creditors 1,385 873 1,091 688 Amounts owed to Group Companies 58 14 46 11 Income Tax deducted under PAYE 188 211 148 166 Pay Related Social Insurance 126 116 99 91 Corporation Tax 1,896 1,426 1,493 1,123 Accruals and Other Liabilities 7,454 9,296 5,871 7,321 Repayable Advances (Note 21) 296 298 233 235 –––––– –––––– –––––– –––––– 11,403 12,234 8,981 9,635 –––––– –––––– –––––– ––––––

21. Creditors

Amounts falling due after more than one year Group and Company

Repayable advances from the Central Fund are used to finance Housing and Community Facilities in Shannon.

2001 2000 2001 2000 €000 €000 IR£000 IR£000

Balance at 1 January 11,721 12,019 9,231 9,466 Amount repaid in year (309) (298) (244) (235) –––––– –––––– –––––– –––––– Advances due at 31 December 11,412 11,721 8,987 9,231 Less: Amounts falling due within one year (Note 20) (296) (298) (233) (235) –––––– –––––– –––––– –––––– Amounts falling due after one year 11,116 11,423 8,754 8,996 –––––– –––––– –––––– ––––––

2001 2000 2001 2000 €000 €000 IR£000 IR£000 Amounts falling due after one year are repayable as follows: Between 1 and 2 years 302 296 237 233 Between 2 and 5 years 964 944 759 743 In 5 years or more 9,850 10,183 7,758 8,020 –––––– –––––– –––––– –––––– 11,116 11,423 8,754 8,996 –––––– –––––– –––––– ––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

22. Deferred Income 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated) Group and Company Received At beginning of year (i) 8,170 8,070 6,435 6,356 Received during year 51 100 40 79 –––––– –––––– –––––– –––––– At end of year 8,221 8,170 6,475 6,435 –––––– –––––– –––––– ––––––

Amortisation At beginning of year 2,123 1,878 1,673 1,480 Amortisation to profit and loss 247 245 194 193 –––––– –––––– –––––– –––––– At end of year 2,370 2,123 1,867 1,673 –––––– –––––– –––––– –––––– Net book value at end of year 5,851 6,047 4,608 4,762 55 –––––– –––––– –––––– ––––––

(i) The balances at the beginning of the year 2000 arose as a result of a prior year adjustment (Note 12).

23. Share Capital 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Authorised €1.27 (2000: IR£1) Ordinary Shares 190,500 190,461 150,031 150,000 –––––––– –––––––– ––––––––– –––––––

Issued and Fully Paid €1.27 Ordinary Shares Balance at 1 January 183,294 181,179 144,356 142,690 Issued during the year (see (i) below) 64 2,115 50 1,666 Renominalisation (see (ii) below) 38 0 31 0 –––––––– –––––––– ––––––––– ––––––– Balance at 31 December 183,396 183,294 144,437 144,356 –––––––– –––––––– ––––––––– –––––––

(i) 50,000 £1 ordinary shares were issued to the Minister for Finance during the year to fund the acquisition of Tourism Capital Assets. These were subsequently converted to €1.27 shares. (ii) During the year ended 31 December 2001, in accordance with the provisions of the Economic and Monetary Union Act, the Company redenominated its authorised and issued share capital from shares of IR£1 each to €1.269738 each. The shares were renominalised to €1.27 and the allotted and fully paid up share capital was increased by €38,146 (IR£30,042) which was transferred from Revenue Reserves.

24. Capital Reserve 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Group and Reserve (as restated) (as restated) Opening balance as at 1 January, 2001 (i) 39,638 38,861 31,216 30,604 Grants received for the acquisition of equity 1,384 777 1,091 612 –––––––– –––––––– ––––––––– ––––––– Closing balance as at 31 December, 2001 41,022 39,638 32,307 31,216 –––––––– –––––––– ––––––––– ––––––– (i) The balances at the beginning of the year 2000 arose as a result of a prior year adjustment (Note 12).

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

25. Analysis of Reserves As outlined in Note 12, during the year the company carried out a detailed review of its accounting practices in light of the changing legislative and regulatory requirement and the growing diversity of the group’s activities. As a result of this review, it was decided to restate the prior year financial statements to reanalyse capital reserves and unfunded depreciation. This resulted in a retained deficit at the beginning of the year of €53,706,000 (IR£42,295,000).

In order to distinguish between items of a Revenue and Capital nature, in accordance with the manner in which the company’s parent Department differentiates between capital and revenue funding, an analysis of reserves is set out below which differentiates between the various sources of funding in this context.

Significant depreciation is charged to the Income and Expenditure account in respect of Fixed Assets, for which the Company was not historically funded. Accordingly, a significant deficit arises in respect of such unfunded depreciation, which is separately identified in the analysis below.

Industrial and Tourism Assets are funded from funds generated from sale of own resources and to a lesser extent from share capital made available by the Minister of Finance. The proceeds from sale of such assets are available to finance further asset acqui- sitions. Surpluses and deficits on such sales are reflected in the Income and Expenditure account. These amounts are reflected as capital in the reserves analysis to give a better understanding of how these surpluses/deficits have been utilised. 56 Housing assets are financed from advances which are repayable to the exchequer by way of annuities. In the analysis of reserves, an amount of rental income equivalent to the principal portions of the annual repayments is classified as a capital item. Surpluses and deficits on sales of housing assets are also classified as capital items.

The analysis of the balance as at 1 January arises from a re-analysis of the opening reserves deficit, following the prior year adjustment (Note 12).

Unfunded Revenue Capital Depreciation Total €000 €000 €000 €000 Group Analysis of Balance as at 1 January 2001 8,908 23,792 (82,730) (50,030) Deficit for the year (2,860) – – (2,860) Capitalisation of rental income for repayable advances (142) 142 – 0 Unfunded depreciation in the year 6,796 – (6,796) 0 Profits on sale of Fixed Assets (5,933) 5,933 – 0 Renominalisation of Share Capital (38) – – (38) Depreciation on asset disposals – (1,855) 1,855 0 ––––––– ––––––– ––––––– ––––––– 6,731 28,012 (87,671) (52,928) ––––––– ––––––– ––––––– –––––––

Unfunded Revenue Capital Depreciation Total € € € € Group 000 000 000 000 Analysis of Balance as at 1 January 2001 7,016 18,738 (65,155) (39,401) Deficit for the year (2,252) – – (2,252) Capitalisation of rental income for repayable advances (112) 112 – 0 Unfunded depreciation in the year 5,351 – (5,351) 0 Profits on sale of Fixed Assets (4,672) 4,672 0 Renominalisation of Share Capital (31) – – (31) Depreciation on asset disposals – (1,461) 1,461 0 ––––––– ––––––– ––––––– ––––––– 5,300 22,061 (69,045) (41,684) ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

25. Analysis of Reserves (continued) Unfunded Revenue Capital Depreciation Total €000 €000 €000 €000 Company Analysis of Balance as at 1 January 2001 7,638 23,792 (82,730) (51,300) Deficit for the year (2,529) – – (2,529) Capitalisation of rental income for repayable advances (142) 142 – 0 Unfunded depreciation in the year 6,796 - (6,796) 0 Profits on sale of Fixed Assets (5,933) 5,933 – 0 Renominalisation of Share Capital (38) – – (38) Depreciation on asset disposals – (1,855) 1,855 0 ––––––– ––––––– ––––––– ––––––– 5,792 28,012 (87,671) (53,867) ––––––– ––––––– ––––––– –––––––

57 Unfunded Revenue Capital Depreciation Total IR£000 IR£000 IR£000 IR£000 Company Analysis of Balance as at 1 January 2001 6,016 18,738 (65,155) (40,401) Deficit for the year (1,990) – – (1,990) Capitalisation of rental income for repayable advances (112) 112 – 0 Unfunded depreciation in the year 5,351 – (5,351) 0 Profits on sale of Fixed Assets (4,672) 4,672 – 0 Renominalisation of Share Capital (31) – – (31) Depreciation on asset disposals – (1,461) 1,461 0 ––––––– ––––––– ––––––– ––––––– 4,562 22,061 (69,045) (42,422) ––––––– ––––––– ––––––– –––––––

26. Reconciliation of Movement in Shareholders Fund 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated) Group (Deficit)/Surplus for the financial year after taxation (2,860) 3,676 (2,252) 2,894 Shareholders’ Funds at 1 January 172,902 172,526 136,171 135,875 New share capital subscribed 64 2,115 50 1,666 Prior year adjustment (See note 12) 0 (6,192) 0 (4,876) Capital Reserve 1,384 777 1,091 612 ––––––– ––––––– ––––––– ––––––– Closing Shareholders funds 171,490 172,902 135,060 136,171 ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

26. Reconciliation of Movement in Shareholders Fund (continued) 2001 2000 2001 2000 €000 €000 IR£000 IR£000 Company (as restated) (as restated) (Deficit)/Surplus for the financial year after taxation (2,529) 3,370 (1,990) 2,653 Shareholders’ Funds at 1 January 171,632 171,562 135,171 135,116 New share capital subscribed 64 2,115 50 1,666 Prior year adjustment (See note 12) 0 (6,192) 0 (4,876) Capital Reserve 1,384 777 1,091 612 ––––––– ––––––– ––––––– ––––––– Closing Shareholders funds 170,551 171,632 134,322 135,171 ––––––– ––––––– ––––––– –––––––

27. Amounts in Group Cash Flow Statement 2001 2000 2001 2000 58 €000 €000 IR£000 IR£000 (as restated) (as restated) (a) Net Cash Flow from Operating Activities

Operating (Deficit)/Surplus before profit/(loss) on (9,195) (5,517) (7,240) (4,347) disposal of assets Adjustment for Unfunded Depreciation 6,796 6,654 5,350 5,241 Movement on Impairment of Investments and Loans 1,676 876 1,320 690 Write off of Assets – 1,551 – 1,222 Profit on Sale of Financial Asset – (9) – (7) Depreciation 7 34 5 27 Amortisation of Government Grants (247) (245) (194) (193) Decrease / (Increase) in stocks 10 (38) 8 (30) Decrease / (Increase) in debtors 32 (748) 24 (590) (Decrease) in creditors (553) (1,112) (431) (874) ––––––– ––––––– ––––––– ––––––– (1,474) 1,446 (1,158) 1,139 ––––––– ––––––– ––––––– –––––––

(b) Analysis of Cash Flows for headings netted in the Cash Flow Statement (b) (i) Returns on investments and servicing of finance Interest Received 622 668 489 526 Investment Income 504 298 397 235 ––––––– ––––––– ––––––– ––––––– Net Cash inflow 1,126 966 886 761 ––––––– ––––––– ––––––– –––––––

b) (ii) Capital expenditure and financial investment

Payment to acquire Tangible Fixed Assets (17,163) (12,377) (13,517) (9,748) Payment to acquire Financial Assets (1,384) (777) (1,091) (612) Receipt from repayment of Loans to other entities (120) (342) (95) (269) Receipts from sales or disposals of Fixed Assets 10,655 13,534 8,392 10,658 Receipts from sales or disposals of Financial Assets 271 918 214 723 Exceptional Item 985 - 776 - Preference shares in Shannon Ventures-Non cash adjustment (39) (79) (32) (62) ––––––– ––––––– ––––––– ––––––– Net Cash (outflow)/inflow (6,795) 877 (5,353) 690 ––––––– ––––––– ––––––– –––––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

27. Amounts in Group Cash Flow Statement (continued) 2001 2000 2001 2000 €000 €000 IR£000 IR£000 (as restated) (as restated) (b) (iii) Financing Issue of Ordinary Share Capital 64 2,115 50 1,666 Repayment of Repayable Advances (309) (298) (243) (235) Grants Received and Deferred 51 100 40 78 Contribution to Capital Reserve 1,384 777 1,090 612 ––––––– ––––––– ––––––– ––––––– Net Cash Inflow 1,190 2,694 937 2,121 ––––––– ––––––– ––––––– –––––––

Cash and Bank Balances 23,064 18,164 (6,157) (4,849) 16,907 13,315 –––––– –––––– –––––– –––––– –––––– ––––––

28. Superannuation Schemes Superannuation benefits (based on retirement rates of pay) are conferred by the Shannon Free Airport Development Company Ltd. (General Employees) Superannuation Schemes. Post retirement pension increases are paid by the Company from current income as they arise.

The Schemes are "Defined Benefit Schemes". The benefits are conferred by regulations (SFADCo. General Employees Superannuation Schemes). Benefits (excluding post retirement pension increases), based on retiring rates of pay, are funded by contributions from employees and the Company. The contributions are transferred to a managed fund administered by Trustees appointed by the Board.

Post retirement pension increases are unfunded and paid by the Company, as they arise, from current revenue in accordance with directions from the Department of Finance. In the event that the Company is unable to fund this liability in future years, any shortfall will be funded by the Exchequer. The accounting treatment of post retirement pension increases, as explained in Accounting Policy “Superannuation Schemes” is not in compliance with SSAP 24 ‘Accounting for Pension Costs’.

The disclosures required by SSAP 24 are dealt with below.

SSAP 24 ‘Accounting for Pension Costs’ Disclosures Contributions to the pension scheme are determined by a professional actuary using the aggregate method of funding. The most recent valuation was at 6 April 2000. The main assumptions were:

Investment Return 7% Salary Increases 5.5% Pension/Deferred pension increases 4.5%

The pension charge for the year in respect of the Company’s defined benefit scheme was €1,529,000 (IR£ 1,204,000) (2000: €1,174,000 /IR£ 925,000).

The most recent actuarial valuation showed that the market value of the scheme’s assets was €41,853,220 ( IR£32,962,089) at 6 April 2000 and that the actuarial value of those assets represented 126.5% of accrued benefits to members, excluding pension increases. If pension increases are included, the funding level was 88%.

FRS 17 Retirement Benefits The Valuation used for FRS 17 disclosures has been based on the most recent actuarial valuation at 6 April 2000 and updated by a professional actuary to take account of the requirements of FRS 17 in order to assess the liabilities of the scheme at 31 December 2001. Scheme assets are stated at their market value at 31 December 2001.

The financial assumptions used to calculate scheme liabilities under FRS 17 are:

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

28. Superannuation Schemes (continued) Valuation Method Projected Unit Discount Rate 6.0% Rate of Expected Salary Increase 4.0% Expected Return on Assets Fixed Interest 5.5% Equities 8.5% Property 7.0% Cash 3.3% Rate of Pension Increase 3.0% Inflation 2.0%

Market Values as at 31 December, 2001 €000 IR£000 Equities 29,631 23,337 60 Fixed Interest Bonds 9,134 7,193 Property/ Other 2,925 2,304 Cash 1,745 1,374 ––––––– ––––––– Total Market Value of Assets 43,435 34,208 Value of Past Service Liabilities (50,570) (39,827) ––––––– ––––––– Deficit (7,135)(5,619) ––––––– –––––––

The Company does not expect that a deferred tax asset will arise as a result of this deficit.

If the above amounts had been recognised in the financial statements, the group's net assets and profit and loss reserve at 31 December, 2001 would be as follows:

€000 IR£000 Net assets excluding pension liability 171,490 135,060 Pension liability (7,135) (5,619) ––––––– ––––––– Net assets including pension liability 164,355 129,441 ––––––– ––––––– Reserves excluding pension liability (52,928) (41,684) Pension liability (7,135) (5,619) ––––––– ––––––– Reserves including pension liability (60,063) (47,303) ––––––– –––––––

29. Contingent Liabilities The eligibility of expenditure on projects for EU aid is subject to review by institutions of the EU. Any adverse findings arising therefrom could result in requests for repayment of aid granted to projects.

An estimate of contingency cannot be determined with any accuracy because it is dependent on the compliance with the grant conditions by third parties and may be offset by recoveries from those parties.

30. Community and Industrial Estate Service at Shannon The Group is responsible for the provision and maintenance of services such as water, sewerage and those roads and public light- ing for which Clare County Council has not yet assumed responsibility under Section 2 of the 1953 Local Government Act. At 31 December, 2001 Clare County Council had assumed responsibility for approximately 3 miles of roads and 30 miles of public light- ing but these roads remain the property of the Group and are included in the assets at the Balance Sheet date.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31. Capital Commitments The value of work not completed at 31 December, 2001 under building contracts entered into by the Group is estimated at €7,306,000 (IR£5,754,000) (2000: €5,542,000/IR£4,365,000).

The value of work authorised by the Board of Directors but not contracted for at 31 December, 2001 is €171,000 (£135,000).

32. Grant Commitments The estimated commitments outstanding at 31 December on foot of grants awarded in the Shannon Region were:

2001 2000 2001 2000 €000 €000 IR£000 IR£000

Shannon Free Zone Industries 31,000 45,711 24,414 36,000 Indigenous Industries 42,000 45,711 33,000 36,000 Tourism ERDF 20 2,642 16 2,081

33. Subsidiaries and Related Companies 61 Subsidiary Companies Name Nature of Business % Share Registered Office Capital Owned

Shannon Castle Banquets & Heritage Limited Operation of Medieval Banquets 100 Bunratty Castle and and Ceilis and management of Folk Park, Bunratty, day visitor attractions. Co. Clare.

Shannon Castle Banquets Limited Non trading. 100 Shannon Airport House, Shannon, Co Clare.

Castle Banquets (Shannon) Limited Non trading. 100 6/7 Glentworth Street, Limerick.

The National Technological Park Non trading. Development of the National 100 Park House, The Plassey Limited Technology Park at Plassey, Co. Limerick. National Technology Park, Limerick.

Plassey Technological Park Limited Non trading. 100 Park House, The National Technology Park, Limerick.

Plassey Technopolis Limited Non trading. 100 Park House, The National Technology Park, Limerick

The Plassey National Science Park Limerick Non trading. 100 Park House, The National Technology Park, Limerick.

Kilrush Creek Marina Limited Promotion and operation of a marina. 100 Shannon, Co Clare.

Shannon Estuary Development Company Non trading. 100 6/7 Glentworth Street, Limited Limerick.

Related Companies National Microelectronics Applications Supply of contract electronic development 30 University of Limerick, Centre Limited and consultancy services to industry. Plassey, Limerick.

Youth Enterprise (Shannon) Limited Non trading. 49 Shannon, Co. Clare.

Shannon Ventures Limited Venture Development Company. 331/3 Innovation Centre National Technology Park Limerick

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

34. Commitments under Lease Obligations An amount of €716,000 (IR£564,000) has been charged in the Financial Statements in respect of operating leases. The Company has commitments to pay €857,000 (IR£675,000) during 2002 in respect of leases expiring as follows:

Land & Buildings Other Total Land & Buildings Other Total €000 €000 €000 IR£000 IR£000 IR£000

2002 64 81 145 50 64 114 2002-2006 16 125 141 13 98 111 2007 and after 571 0 571 450 0 450 –––– –––– –––– –––– –––– –––– 651 206 857 513 162 675 –––– –––– –––– –––– –––– ––––

35. Schedule of other Investments at 31 December, 2001 The following investments were held by the Company as disclosed in Note 16. The results of these Companies have not been 62 included in the group financial statements as Shannon Development does not consider these invested companies to be associated undertakings.

Company Name Investment Share Type Cost Cost €000 IR£000 Unlisted Investments Abbey Mushrooms Cumulative Participating Redeemable Preference 67 53 Antigen Pharmaceuticals Cumulative Redeemable Preference 381 300 Aspen Workflow Cumulative Convertible Redeemable Preference 190 150 Ballyneety Manufacturing Cumulative Redeemable Preference 257 202 Burrenside Co-op Cumulative Redeemable Preference 65 50 Business Innovation Fund Various Share Classes 857 675 Cambewell Manufacturing Cumulative Redeemable Preference 85 67 Celtbury Cumulative Redeemable Preference 254 200 Corporate Apparel Cumulative Redeemable Preference 38 30 Countdown Cleaning Cumulative Redeemable Preference 63 50 Datamate Global Ordinary 190 150 Drum Furniture Ordinary 128 101 FP Manufacturing Cumulative Redeemable Preference 67 53 Galtee Wood Products Cumulative Redeemable Preference 254 200 Glass Innovations Ordinary 63 50 Greenacre Foods Ordinary and Cumulative Convertible Redeemable Preference 572 450 Greenvale Cumulative Redeemable Preference 44 35 Homenet Communications Ordinary 127 100 Ingenium Systems Ordinary 133 105 Innroom Control Systems Ordinary and Cumulative Convertible Participating Redeemable Preference 349 275 Key Tech Ordinary and Cumulative Convertible Redeemable Preference 578 455 LBE Ordinary and Cumulative Redeemable Preference 271 213 M & Q Packaging Ordinary 48 38 M & Q Plastics Cumulative Participating Preferred Ordinary 24 19 Nowcasting Ordinary and Cumulative Convertible Redeemable Preference 254 200 Ocean West Cumulative Convertible Participating Redeemable Preference 63 50 Piercom Ordinary 858 676 Pulse Learning Cumulative Convertible Redeemable Preference 190 150 Radlink Cumulative Convertible Participating Ordinary and Cumulative Redeemable Preference 445 350 Romaquip Ordinary and Cumulative Redeemable Preference 206 162 Shannon Aerospace Non-Cumulative Redeemable Preference 3,754 2,956

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

35. Schedule of other Investments at 31 December, 2001 (continued)

Company Name Investment Share Type Cost Cost €000 IR£000

Smithstown Holdings Ordinary and Cumulative Redeemable Preference 1,840 1,450 Spectra Laboratories Cumulative Redeemable Preference 57 45 Tango Telecom Ordinary 190 150 Tekelek Ordinary and Cumulative Redeemable Preference 381 300 Transtest Ordinary 254 200 Viewlight Systems Cumulative Convertible Participating Redeemable Preference 190 150

Listed Investments First Active plc Ordinary 0 0 Greencore Group plc Ordinary 635 500 Interwave Communications Limited Ordinary 0 0 Prosoft Training.com Ordinary 317 250 63 SMF Technologies plc Ordinary 0 0 –––––– –––––– Total Investment at Cost 14,739 11,610 Less: Impairment Provision (Note 16) (3,517) (2,772) –––––– –––––– 11,222 8,838 –––––– ––––––

Listed Investments Stock Quoted Market Value Market Value €000 IR£000 First Active plc Irish Stock Exchange 2 1 Greencore plc Irish Stock Exchange 622 490 Interwave Communications Limited NASDAQ 24 19 Prosoft Training.com NASDAQ 104 82 SMF Technologies plc Alternative Investments Market 63 50

36. Capital Development Works During 1999, a special allocation of IR£1.5m was made by the Department of Tourism, Sport and Recreation to the Company. This allocation was split between 1999 (€1.27m (IR£1m)) and 2000 (€635,000 (IR£500,000)). The purpose of the allocation was to fund three projects; Jeannie Johnston (a ship built to the replica of a famine ship dating from the 1850s) (€1.08m (IR£850,000)), Tralee Aqua Golf (€190,000(IR£150,000)) and the International Folk Music Centre for Ireland (€634,000(IR£500,000)). The €634,000 (IR£500,000) approved for the International Folk Music Centre for Ireland was ultimately funded from ERDF funds and not the special Exchequer allocation of €1,900,000 (IR£1,500,000)

As at 31 December, the following amounts had been paid on these projects:

2001 2000 2001 2000 €000 €000 IR£000 IR£000

Jeannie Johnston Project 1,079 1,079 850 850 Tralee Aqua Golf Project 190 190 150 150 ––––– ––––– ––––– ––––– 1,269 1,269 1,000 1,000 ––––– ––––– ––––– –––––

SHANNON DEVELOPMENT ANNUAL REPORT 2001 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

37. Directors – Disclosures of Transactions In the normal course of business, the Company may approve grants and may also enter into other contractual arrangements with undertakings in which directors are employed or otherwise interested.

The Company adopted procedures in accordance with the guidelines issued by the Department of Finance in relation to the disclosure of interests by directors and these procedures have been adhered to during the year.

General payments totalling €471,000 (IR£371,000) were made to companies in which a director had an interest.

38. Directors’ and Secretary’s Interest in Share Capital The Directors and Secretary did not have any beneficial interest in the share capital of the Company at 31 December, 2001, or at any time during the period covered in the financial statements.

39. Related Party Transactions The Company is availing of the exemption under FRS8, Related Party Transactions not to disclose transactions between the mem- 64 bers of the group which are at least 90% owned subsidiaries of the group. There are no other transactions with related parties.

40. Ultimate Controlling Party The Government through the Minister for Finance is the majority shareholder in Shannon Free Airport Development Company Limited. The Company reports to the Department of Enterprise, Trade and Employment on industrial activities and to the Department of Tourism, Sport and Recreation on tourism activities.

41. Post Balance Sheet Events At 31 December 2001, agreement in principle had been reached with Clare County Council to transfer the assets and services in respect of Shannon Town from the Company to Clare County Council. It is proposed that this handover will occur on a phased basis over the period to April 2003. At 31 December 2001, the net book value of the assets to be transferred amounted to €5.9m (IR£4.6m). In addition, the Finance Act, 2002 contains provisions to enable the waiver of repayment of the balance due on the Repayable Advances of €11,116,000 (IR£8,754,000) on completion of the handover of Shannon Town to Clare County Council.

42. Comparative Amounts Certain comparative amounts have been regrouped and restated where necessary on the same basis as those for the current year.

43. Approval of Financial Statements The financial statements were approved by the Board of Directors on 13 May 2002.

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY LOGOS

Company logos viding advice and support, Shannon Development is itself directly involved in Shannon Development's business is businesses and developments in the regional development. This mission is tourism, industry, services, property and achieved in a number of ways. These other wealth-creating sectors. The selection include advising individuals, groups and of Shannon Development-related logos dis- bodies through research and information, played here gives a graphic illustration of supporting entrepreneurs, companies and the wide range of activities in which the local groups, by focusing on initiatives at Company is engaged. sector and regional levels. As well as pro-

SHANNON DEVELOPMENT ANNUAL REPORT 2001 CURRENT ORGANISATION STRUCTURE

CORPORATE DEVELOPMENT DIRECTOR/COMPANY SECRETARY Sean Fitzgibbon

BUSINESS SYSTEMS: Pat McCarthy FINANCE: Therese Ross HUMAN RESOURCES: Deirdre Hughes INFORMATION SYSTEMS: David Hogan

HERITAGE & TOURISM DIRECTOR John King

PRODUCT DEVELOPMENT: Brendan Lynch 66 REGIONAL TOURISM & INNOVATION: John Leonard SHANNON HERITAGE: Kieran McNamara, Chief Operating Officer

CHIEF EXECUTIVE Kevin Thompstone

KNOWLEDGE ENTERPRISE DIRECTOR Patricia Byrne

IRISH ENTERPRISE: Neil O’Sullivan KNOWLEDGE DEVELOPMENT: Alice Morgan NEW ENTERPRISE: John Dillon REGIONAL INVESTMENT: Michael Leydon

RESEARCH, DEVELOPMENT & COMMUNICATIONS DIRECTOR Olivia Loughnane

COMMUNICATIONS: Frank Larkin CONSULTANCY & EUROPEAN AFFAIRS: Ina Reddan PLANNING & RESEARCH: Brian Callanan

SPATIAL DEVELOPMENT DIRECTOR Martin McKeogh

CLARE: John Quinlivan LIMERICK CITY & COUNTY: Pat Daly NORTH KERRY: Ogie Moran PROPERTY: Vacant TIPPERARY NORTH & SOUTH OFFALY: Tomás Ó’Domhnaill

SHANNON DEVELOPMENT ANNUAL REPORT 2001 COMPANY OFFICES

Registered Office Business & Workspace County Limerick Shannon Development Centres Bay 5 Workspace Shannon Clare Newcastlewest Industrial Estate Co Clare Clare Business Centre Co Limerick Ireland Francis Street Tel. (069) 62977 Tel. (06l) 361555 Ennis Fax. (069) 62898 Direct Dial Facility: (061) 710 Co Clare followed by Extension No. Tel. (065) 6820166 Fax (06l) 361903 Fax. (065) 6821234 North Tipperary Email: [email protected] Nenagh Workspace Centre Url: www.shannondev.ie Shannon Business Centre Connolly Street Town Centre Nenagh Shannon Co Tipperary Tel. (061) 362422 Tel. (067) 32100 Regional Development Fax. (061) 362024 Fax. (067) 33418 Offices 67 The Granary Tulla Business Centre Michael St Tulla Limerick Co Clare Overseas Offices Tel. (06l) 410777 Shannon Development Fax. (061) 315634 Suite 435 Fairmount Plaza Limerick City 50 West San Fernando St Silverline Building Workspace Centre San Jose Connolly Street Michael Street California 95113 Nenagh Limerick Tel. 001-408-294-9083 Co Tipperary Tel (06l) 416800 Fax. 001-408-294-8226 Tel. (067) 32100/32692 Fax (06l) 414709 Fax. (067) 33418 Shannon Development Tait Business Centre 345 Park Avenue – 17th Floor Brendan Street Dominic St New York Birr Limerick N.Y. 10154-0037 U.S.A. Co Offaly Tel. (061) 419477 Tel. 001-212-3715550 Tel. (0509) 20440/20923 Fax. (061) 414315 Fax. 001-212-3081485 Fax. (0509) 20660 Innovation Centre Francis Street National Technology Park Limerick Ennis Limerick Co Clare Tel. (06l) 338177 Tel. (065) 6820166/6820165 Fax. (061) 338065 Fax. (065) 6821234 Limerick Food Centre InnovationWorks Raheen Business Park Kerry Technology Park Limerick Tralee Tel. (061) 302035 Co Kerry Fax. (061) 301172 Tel. (066) 7190000 Fax. (066) 7190070

SHANNON DEVELOPMENT ANNUAL REPORT 2001 SUBSIDIARY COMPANIES AND TOURIST INFORMATION OFFICES

Subsidiary Companies Shannon Region Tourist Tourist Information Office Arrivals Hall Shannon Castle Banquets and Information Offices Shannon Airport Heritage Ltd Tourist Information Office Co Clare Folk Park Heritage Centre Tel. (06l) 471664 Bunratty Main St Fax. (06l) 471661 Co Clare Adare Tel. (06l) 361511/360788 Co Limerick Tourist Information Office Fax. (06l) 472523 Tel (06l) 396255 The Spinners Theatre Url: www.shannonheritage.com Fax (06l) 396610 Castle St Birr Kilrush Creek Marina Ltd Tourist Information Office Co Offaly Cappa Rd Arthur’s Quay Tel. (0509) 20110 Kilrush Limerick Co Clare Tel (06l) 317522 Tourist Information Office Tel. (065) 9052072 Fax (06l) 317939 Silverline Building 68 Fax. (065) 9051692 Connolly St Url: www.kilrushcreekmarina.ie Tourist Information Office Nenagh Ennis Tourist Centre Co Tipperary The National Technological Park Arthur’s Row Tel (067) 31610 Plassey Ltd Ennis Fax (067) 33418 Park House Co Clare National Technology Park Limerick Tel. (065) 6828366 Tourist Information Office Limerick Fax (065) 6828350 St John’s Church Tel. (061) 336555 The Square Fax. (061) 336545 Tourist Information Office Listowel Url: www.shannondev.ie/ntp O’Connell Street Co Kerry Kilkee Tel. (068) 22590 Co Clare Tel (065) 9056112 Tourist Information Office Ashe Memorial Hall Tourist Information Office Denny St Heritage Centre Tralee The Bridge Co Kerry Killaloe Tel (066) 7121288 Co Clare Fax (066) 7121700 Tel. (06l) 376866

Tourist Information Office Town Hall Kilrush Co Clare Tel. (065) 9051577

Tourist Information Office Cliffs of Moher Visitor Centre Liscannor Co Clare Tel. (065) 7081171

SHANNON DEVELOPMENT ANNUAL REPORT 2001

Annual Report 2001 ... priority must go to investment“ in activities based“ on the production, distribution, and use of knowledge and information. SHANNON DEVELOPMENTANNUALREPORT 2001 SD02-119

Cuideachta Forbartha Aerfort Neamhchustam na Sionna Teoranta Pn 11234 Shannon Free Airport Development Company Limited