Whether I meet Owen Brennan at his home in Beauparc or at Devenish’s research farm in Dowth, both within a short distance of Newgrange in Co Meath’s historic Boyne Valley, the first thing he shows me is trees. Then he moves on to the wild flower meadow that has replaced his front lawn, the wild deer roaming the sprawling Dowth estate, and the many archaeological features in between. 

At first, this all seems very remote from Brennan’s successful global feed ingredients business, which I’ve come to discuss. The Devenish group posted £225 million in revenues in 2018, growing the figure by over 20 per cent for each of the past two years. Operating profit was £3.6 million and the group sat on £29 million in shareholders’ funds, against £31 million in debt.

None of this came from the sale of trees, wild flowers or deer – or not yet, because this is very much the direction Brennan says the company is taking for the future. Devenish spends ten times its operating profit in research and development in an effort to “to understand what it is nature intended, and seek to deliver as close as we can to that natural outcome, while optimising the economic outputs upon which, in a sense, society overall is going to depend – in this particular case its dependence on the production of high quality food,” Brennan said.

This strategy statement may sound lofty, yet it has secured millions in EU funding for Devenish in the past year. To understand how, I ask Brennan to go back two decades and explain how he got to this point. 

“Bring modern technology to Northern Ireland”

Devenish founder John Brooke

The eldest of 10 children from a family of local farm supplies merchants in Leighlinbridge, Co Carlow, he first worked for feed mills before taking the entrepreneurship plunge in 1997. With colleagues, he bought a majority stake in Belfast-based Devenish, a feed manufacturer with £5 million turnover and 23 staff. “The attraction for me was that the business was long-established, it had been established by the Brooke family in 1952 in Co Fermanagh,” said Brennan. He still stands by the motto of company founder John Brooke: “Bring modern technology to Northern Ireland.”

Brennan and his partners expanded and modernised the existing feed mill and quickly bought into Omega, a small American feed business in Minnesota. “Even though the business at that time was very Northern Ireland-centric, we wanted to make it clear from the beginning that our interests were quite international,” he said.

Devenish now employs over 750 people. “A business which had revenues of £5m a year 20 years ago now has revenues of £5m a week, with the intention of scaling that up again four to five-fold in the next three to five years,” Brennan said. 

Mexico, Kenya and Turkey

Its products, manufactured in the UK and the US, are sold in nearly 50 countries. “At the end of our last financial year, we had two manufacturing locations in North America, at this time next year we expect to have five,” Brennan said. This includes expansion into Mexico, while Devenish has recently acquired stakes in Kenyan and Turkish businesses. The company also has a 50-50 joint venture with Irish Aid in Uganda, where it runs a model pig farm and a feed mill to improve local livestock genetics and nutrition while creating a market for itself. 

Brennan said Devenish currently draws its revenues from three types of products: animal feed supplements, containing nutrients which are “essential for life and for performance but required in the diet in very small quantities”; early-stage diet feed – “essentially baby foods for baby animals of all species”; and specialised nutritional products designed to achieve a particular outcome in livestock.

Much of Devenish’s growth has taken place through acquisitions, and this is set to continue. Brennan said the company would spend the next six to 12 months preparing to pace up external growth. “As the scale of our core operation continues to expand, I think our interest in larger acquisitions will grow in parallel,” he said. “So nothing immediately on our horizon, but we do think that will change in the next 12 to 18 months as that capability becomes better established.”

Lessons learned from going global

Growing Devenish from a Northern Ireland local feed mill to an international nutrition group has taught Owen Brennan one thing: “Always to expect the unexpected – this has ranged from currency to animal health issues, for example foot-and-mouth and, at one point, avian influenza.” The latest livestock disease challenge comes from African swine fever, which has been decimating Asian piggeries and is now present in Europe.

The accelerating pace of technology and globalisation also means that people’s skills will become useful in ways that we don’t suspect today. “I think If there is a danger setting out in business, it would be to underestimate how much application those typically will have wherever you go in the world,” Brennan said.

Entering new markets, including African countries where very few Irish companies go, is always a step-by-step process for Devenish. “Typically we will start by supplying into that market in a targeted way where we gain experience,” said Brennan. This includes identifying local, experienced people familiar with the market. “Over time we develop a degree of business in the location before we establish an office and certainly before we establish manufacturing. So typically, by the time we are represented by physical assets, we have a substantial amount of business already taking place and a substantial amount of experience of that market, both of our own, but particularly experience of our local colleagues.”

One milestone was when Devenish grew from 23 employees in 1997 to 23 nationalities among staff in 2012. “We have 26 or 27 nationalities today,” Brennan said.

Despite local differences, he added that the company relies on common principles around the world: “Food in times of recession, in times of boom, tends to be one of the more consistent areas of business, as in turn is farming.” Everywhere, farmers are grounded by the stability of their asset base – land. “But probably the thing that supports this area of business most is the fact that demand is in general very consistent and continues to grow, ” Brennan added. “We have a significant growth in the population of the world and a significant growth in the demand for quality of food as well as quantity of  food. And I don’t see any change in that progression.”

While Devenish has grown forty-fold since Brennan took over, he insists this doesn’t tell the whole story. “It’s not just a change in size, it’s also a change in nature: we’ve remained focused on the same business area, but we address it now in some different ways,” he said. “We spend annually now between £30m and £40m a year on innovation projects of all kinds, with a particular focus on health and addressing sustainable farming and food production looking forward. It’s across all species. We define our strategic focus as one health, from soil to plant to animal to human to environmental health all considered together – a whole-system approach.”

Devenish is now moving its global research and development headquarters to Dowth. The group bought the old Netterville Institute adjacent to the farm last year – all historically part of the Netterville landlords’ estate. Land registry documents show that the property went on sale following a 2016 judgement obtained by AIB against retired High Court taxing master James Flynn and his company Fortberry Ltd.

“We won’t have much change out of €15 to 20 milllion”

In July, Devenish obtained planning permission to redevelop the 19th century almshouse into a suite of labs and offices, the Netterville Institute Devenish Global Centre of Innovation, through its new R&D subsidiary. This is part of a wider corporate reshuffle that saw the registration of a new holding company for Devenish in at its Northern Ireland headquarters this year.

Brennan, his family and Devenish had previously bought Dowth for €5 million in 2013 and have been adding to its land holding ever since. With the €2 million purchase of Netterville and ongoing redevelopments, “we won’t have much change out of €15 to 20 milllion,” Brennan said.

“It has been one outcome of our growth – we felt the need to headquarter our innovation all by itself to have a centre to which everything would devolve,” he added, showing me the chronological panoramic view that greets the visitor to Netterville: from a prehistoric tumulus to the right, the eye meets the ruins of an early Christian church, a medieval Norman tower and the Victorian red brick of the main building. Devenish’s new lab will complete the vista to the left.

It will combine with the existing farm at Dowth, where another significant 5,500-year-old passage tomb was unveiled last year. The land overlaps with the Brú na Bóinne Unesco world heritage site and Brennan said redevelopments would accommodate the preservation of archaeological monuments and public access. “The neolithic people who lived here were the first farmers,” he pointed out.

Future-proofing 

Yet the research taking place here is all about future-proofing Devenish. Two pieces keep cropping up in discussion with Brennan, which he showcases to illustrate the attention the company has been gaining up and down the food chain from its core livestock nutrition business. In December, Devenish’s director of agriculture and sustainability, John Gilliland, was awarded best paper for his presentation at the Global Soil Security Conference organised by the University of Sydney. 

One year earlier, the American Heart Association invited Brennan’s wife Alice Stanton, a professor at the Royal College of Surgeons, to present her research on omega-3 enriched poultry feed made by Devenish from algae ingredients. She found that eating chicken and eggs three times a week from birds fed with the product halved the number of people falling in the lowest omega-3 index group. This group is associated with higher heart and brain health risks.

Academic work on this is continuing: “We’ve just submitted a paper for consideration by The Lancet looking at the utility of high-quality food to promote good health in people and to overtly prevent ill-health,” said Brennan. But he is also keen to demonstrate innovations’ commercial potential while scientific validation is on-going. Omega-3-enriched chicken is already processed by Moy Park and sold as such through Waitrose in the UK – at a premium.

Devenish Dowth sheep
Sheep graze an experimental multi-plant sward at Devenish’s research farm in Dowth, Co Meath. Photo: Thomas Hubert

The farm grazing beef cattle and sheep over more than 400 acres at Dowth, too, aims to implement research and development conducted by Devenish in commercial conditions. “We had a large acreage of grassland, some of which had never been cultivated and were ready to provide that measurement base,” Brennan said. “A lot of the ideas and technologies that we’re now applying, we had some experience of those in small plots and in lab circumstances, but we wanted to quickly move to demonstrate that these could be applied at scale and could also be applied globally.”

“We produced the first whole-farm carbon sequestration calculation in trees and hedgerows in the world in 2014”

A large portion of the work conducted here has focused on soil health, climate change and water protection. With Teagasc, Devenish used a laser imaging technology to map the farm: “By harnessing LiDAR we have been able to do very large scale carbon calculations very inexpensively, we have also been able to map overland flows of water, again to the inch,” Brennan said. “We produced the first whole-farm carbon sequestration calculation in trees and hedgerows in the world in 2014.”

Water flow maps help target the application of slurry to minimise nutrient run-off to the river Boyne. The objective is to “create the circumstances whereby simple, inexpensive interventions can be provided which interrupt that flow before it enters the watercourse and captures the nutrients”. 

Farm managers and consultants have been mapping the soil’s acidity by GPS and correcting it to improve its capacity to manage nutrients. They are now measuring the farm’s ability to store carbon underground and trialling new types of wards combining grass with a range of plants offering alternative environmental and nutritional benefits, such as chicory.

This may turn Dowth into an environmentalist’s dream farm, but how will it make any money? According to David Hagan, sustainable agriculture manager at Devenish, it already does. 

Soil improvement programme

The company has sold its soil improvement programme to Bandon co-op in west Cork. The co-op’s dairy farmers receive assistance from Devenish to aerate their soil, measure and address its chemical and biological composition and use Digest-it, a cattle slurry additive made by the company. The product contains bacteria and enzymes chosen to reduce emissions of harmful ammonia gas, improve biological activity in the soil and grow more grass out of the nutrients available to the plant.

Hagan said the programme delivers both environmental and economic benefits to expanding dairy farmers, who are stuck between the inability to acquire more overpriced Cork land and environmental limits if they stock their farms more heavily. Getting information on your soil’s health could be equally valuable to farmers who decide to go the other way: “They can decide to go more extensive and claim payments for environmental services,” Hagan said.

Brennan said Devenish’s revenues would evolve towards a combination of advisory fees and product sales. “It’s become very data driven,” he said. “Once you can measure, you can manage.” While based here in Ireland, he is confident that much of Devenish’s soil research will be applicable around the world.

This brings us back to the trees. Agroforestry could target planting to small areas where water flows cause environmental problems, and integrate trees into grass swards. According to Brennan, this is showing potential to treble carbon sequestration in soils, while extending the grazing season by as much as 17 weeks. He is convinced that a farmer could lose up to 10% of their holding to trees while more than making it up through additional grazing – and improving their climate change and biodiversity credentials in the bargain.

These trees are not for hugging, and Brennan vocally rejects a lot of the blanket criticism currently levelled at livestock farming on health and environmental grounds. “Central focus to our focus is a support of highly productive farming. We call it sustainably intensive farming,” he said. “Because again, central to this work, we believe, is the global demand for food, which we think will continue to increase and increase substantially. So how do we balance that requirement to produce high-quality food, which is affordable, which is accessible globally, with our obligations in terms of our environment, biodiversity, the wider ecosystem?”

EIB funding

This approached convinced the European Investment Bank, Ulster Bank and Danske Bank to provide a €118 million long-term finance package for Devenish last year. Of this, €40 million comes from the EU-backed institution under the form of a quasi-equity loan. “They don’t take an equity position, but they have sought to construct a financing position which creates all of the advantages of an actual equity position,” Brennan said.

According to him, the EIB approached Devenish first, looking to finance projects that would transform agriculture and food. “This is about delivering impact,” he said. The loans will fund research and development with flexible deadlines: “Once we have that underlying support from the European Investment Bank, then our commercial financial arrangements stand on that foundation. It gives us the ability to navigate the time scales which are never clear at the beginning in terms of precisely how long, precisely what the scale of that investment might be,” Brennann said. 

“It creates the ability for us to have a financial capability which in essence can be quite limitless”

“It’s game-changing for Devenish in that it creates the ability for us to have a financial capability which in essence can be quite limitless,” he added.

Since then, Devenish has secured another €1.4 million in EU funding – this time as a grant for the Heartland project with Wageningen University in the Netherlands. This will fund five PhD students to spend one year at Wageningen and three years at Devenish, researching ways of improving health and environmental performance in ruminant livestock.

Brennan on Brexit

As a Northern Ireland-headquartered group of companies trading in sterling and extending to the UK, Ireland, continental Europe and beyond, Devenish is facing “a big challenge” in Brexit, Brennan said. “Probably the biggest single element of that challenge to date has been the impact on sterling currency value. The value of sterling has declined dramatically and shows no sign of doing anything else for the foreseeable future.”

He finds it “amazing” that no clarity has emerged into the fourth year since the UK referendum and expects this uncertainty to last. “Even in the event of a no-deal Brexit, I think clarity will still take a long time to emerge because deals will eventually be done – will be required to be done. It will be simply a question of how long that’s going to take and what form those agreements will represent.”

Yet despite Brexit and the wider threat of global trade wars, Brennan is confident in the continued integration between the Russian dolls that form Devenish’s international markets. “Ireland is quite a small place and we tend to think of the island as one from a business point of view,” he started. EU membership has made business easier since he took over the company, he continued: “Whether it’s currency, trade rules, labelling – all the barriers that one would have foreseen 20 years ago have largely fallen away.”

He does acknowledge a challenge to this long term trend, with a big question mark over the next five to 10 years. “But as against that challenge, the overall direction of travel in terms of joining up of the globe – I do think that’s irreversible,” he said.

Brennan said the current backlash against globalisation may end up supporting it in the long run: “Brexit to date probably has been a case study of how negatively impactful political developments of that nature can be, and perhaps call out for more cooperation, more joining up, not less.”

Private ownership

“It happens on a lot of farms and business premises,” he said – including the home he grew up in. Despite this and participation by some of his relatives in the company, he does not not like to describe Devenish as a family business and prefers to talk about private ownership. 

All employees have access to an ESOP equity scheme and senior managers have direct stakes in the company. “Yes, I remain the majority shareholder, but it has been an ambition from a very early stage that very member of staff would have a solid basis upon which to consider this our business as opposed to mine,” Brennan said.

Owen Brennan
Devenish executive chairman Owen Brennan. Photo: Bryan Meade

Given Devenish’s growth trajectory, was he ever tempted to take the company public? “Not really,” he said, adding: “I never say never.” He finds that private ownership has served the company well so far: “It’s people in the business largely who set the direction,” he said, and their calibre, interest and knowledge means they’re best placed to do this.

“In conjunction with the EIB, it allows us to be quite long term in our thinking. Markets, generally, have become we think very short term,” Brennan added. “Without that long term commitment, transformative change is not really possible.”

23 broken bones and a punctured lung

I asked him whether Devenish’s ownership makes it very dependent on him as a person – especially in light of a 2012 horse riding accident that left him with 23 broken bones and a punctured lung. “That accident could easily have ended my life, it could easily have left me in a very disabled position, and thankfully neither of those two things happened. Before that accident had occurred, we had a drive to make sure that there was management, technical, financial, commercial cover for every single individual in the business including myself,” Brennan said. 

His own experience only served to reinforce this policy. “The company has long ago ceased to be wholly or very dependent on me. I have a very large team of very capable colleagues,” he said.

Now aged 59, Brennan did ride again after the fall, but quickly stopped for good. His long stay in hospital, surrounded by people who did not all make it, gave him “perspective”. “If I ride, I will hunt,” he said – his love of the sport has led him to host an annual hunt at Dowth since 2015, but he knows not to tempt fate again by taking part himself.

“I like to think that if I weren’t here, I might be missed occasionally, but I think it would be a very poor position for the business to have it it were to be too dependent on any one individual or any groups of individuals,” he said. “That most definitely would and did include me.”