The horse show's home will look a little different if plans to redevelop the Anglesea Stand get the go-ahead
Show goes on at RDS despite tough times
THEY’RE NOT letting the grass grow under feet at the Royal Dublin Society in Ballsbridge.
Chief executive Michael Duffy told me this week that it is exploring plans to redevelop its Anglesea Stand to boost the capacity of its showgrounds to about 23,000 from its current 18,500.
This could involve a demolition of the double-decker stand or, more likely, a complete makeover to bring it up to modern standards. “We’re looking at both options,” Duffy said.
The RDS has also engaged Fintan Drury’s Platinum One to market the naming rights for the stand, which is home to Leinster rugby, the annual Dublin Horse Show and a variety of music concerts (Bon Jovi will play there this summer).
“Our feeling is that is a premium property and there should be significant interest,” Duffy said.
The RDS’s 2010 annual report has just been published.
Commercial income fell by 16.6 per cent, as the RDS saw its conferences business squeezed. But it maintained its surplus (profit) at €1.3 million due to prudent cost management.
Commercial income declined to €12.9 million from €15.7 million but revenues from its Simmonscourt office development – where tenants include Irish Distillers and the International Rugby Board – rose marginally to €2.25 million.
Membership fees were steady at €527,000.
On the expenditure side, just under €600,000 was shaved off its payroll costs, while general overheads came down by more than €900,000.
The RDS paid interest of €975,000 on its €22 million, which was used to finance its Simmonscourt offices.
Duffy said there has been “good interest” in the three floors that remain to be let.
A decision on whether to proceed with building two additional blocks will be made “over the next year”, he said.
The planning permission for these runs until September 2014.
Last year was a good one for the horse show, with attendances up by 13 per cent. The five-day event cost €3.9 million to run.
In terms of current trading, Duffy said the first quarter has been “on budget” but 2011 would be “more of the same”, while “2012 is looking like a stronger year. We are holding our own.”
Tech firm enters profitable waters with €21m navy deal
IT LOOKS like a case of profit ahoy for the Shannon-based high-tech business Bustec after it secured a €21 million contract with Lockheed Martin to supply data capture and testing equipment for use by the US navy.
The German-owned company was set up here at the end of 1997 by Fred Bloennigen, but has yet to turn a profit.
At the end of 2009, its accumulated losses stood at €6.4 million and it had loans of more than €3 million outstanding from related companies.
The five-year Lockheed Martin contract for the US navy will help Bustec to double its turnover over the next two years and move it firmly into the black.
“We will be profitable from this year on,” Bloennigen told me confidently yesterday.
He also has other deals close to being signed and is engaged in a €3 million funding round advised by Who42.
“We have one contract where we are close to getting €4.5 million over three years,” he said. “We are also close to getting a contract in the United States doing structural tests on airplanes.”
Bloennigen, who has a nuclear physics background, is looking to hire eight new staff over the next year – technicians, software engineers, marketing executives and an international sales manager.
Bustec has been a slow burn, but its data capture and test equipment is used in French nuclear power facilities and in the construction and testing of the international space station.
But it took Bloennigen six and a half years to secure the contract with the French nuclear power stations. Given the conservative nature of its clients, Bustec was always a long-term punt by Bloennigen and his five German backers when he accepted an offer from Shannon Development to set up here.
“When we opened, I said in five to six years we will be profitable. But one of the older guys [investors] said ‘Fred, come on, it will take 10 years to get into black numbers’.
“He was right.”
Upbeat rating of prospects for Aer Lingus
SOME INTERESTING observations on Aer Lingus this week from Merrion Stockbrokers, a former adviser to the airline.
Analyst Gerard Moore put a buy rating on the stock, with a target price of €1.06 (a 32.5 per cent premium to its current level).
Moore suggests Aer Lingus can be profitable, even with Brent oil trading at $125 a barrel.
In relation to the €400 million deficit in the joint pension scheme operated with the Dublin Airport Authority, he puts Aer Lingus’s liability at €240 million in a worst-case scenario. That equates to 45 cent a share.
“Assuming Aer Lingus comes to some type of compromise with the trustees in terms of co-ordinating payments with the State, increasing employee contributions and/or investing in higher yield government annuities, we would expect any settlement to be less than this amount,” he said.
Moore sees “few benefits” in Aer Lingus joining one of the global airline alliances, as chief executive Christoph Mueller has suggested it might.
The cost of joining an alliance is put at €20 million to €40 million, comprising an investment in IT, business lounges and service upgrades.
He says a “full takeover” makes more sense and believes “the Irish State and Ryanair would be sellers of their combined 55 per cent stake”. Michael O’Leary might have something to say about that.
Pernod Ricard toasts Jameson's success
FRENCH DRINKS giant Pernod Ricard be raising a glass to the continued success of Jameson Irish whisky.
It shifted 3.2 million cases last year – growth of 16 per cent – to move up to 29th in the ranking of the world’s top 100 premium spirits brands as produced by industry publisher Impact.
This saw it overtake Seagram’s Gin and vodka brands, Stolichnaya, Sobieski and Finlandia.
It took Jameson 10 years, from 1996 to 2006, to go from one million to two million cases but only four years to pass the three million mark. At that rate, it should pass four million in a couple of years.
Jameson is selling more than one million cases a year in the US, which is leading its growth charge.
Pernod Ricard now wants to expand its warehousing and maturation capacity and recently got planning permission to build a facility at Dungourney in Cork.
Meanwhile, in an interview with Impact, Stella David, chief executive, William Grant Sons, said Tullamore Dew Irish Whiskey was “going very well” since its purchase last year from CC.
“The brand already has strong momentum in many of its core markets and has returned to growth after a slightly flat period in 2009,” David said.
“In the US market, Tullamore Dew is relatively small but there’s no reason it shouldn’t grow there along with the category.”
She sees “great opportunities” in travel retail, where it is “underdeveloped”.
Little Things
ARNOTTS’ SHOE shop in the Stillorgan Shopping Centre will close tomorrow after many years of trading.
The department store group has taken the decision that the shop is “non-core” and it will be replaced next Monday by Ecco, a specialist shoe company. Ecco is a partner at Arnotts’ flagship store in Henry Street. Arnotts is laying off eight staff due to the decision.
Dublin-based PR agency Unique Media has added drinks group Gilbey’s and sports retailer Elverys to its client roster.
Unique won a five-way pitch for Gilbey’s wine portfolio, which was bought by Gleeson Wine Spirits from Diageo last year. The agency is charged with building brand awareness for the Gilbey’s portfolio.
Unique, which is owned by Al Dunne and Breda Brown, will also devise a PR campaign for Elverys.
I’m told Abu Dhabi airline Etihad is poised to sign up for another year as sponsor of the All-Ireland hurling championship.
This would once again put it alongside Guinness and Centra as hurling sponsors, with all three deals up for renewal at the of 2011.
Etihad’s Dublin route is believed to be the sixth-most profitable in its network. The airline has used the hurling deal to build brand awareness here since 2008.
