Business empire succeeding on more than a wing and a prayer
Omega Air chief is still optimistic on economy
Published 18/02/2010 | 05:00
IT'S Friday afternoon and Ulick McEvaddy is chasing his tail. It's the last day in the office before yet another trip Stateside, he has a million things to do before he goes and the "guys from Deutsche" got in late so he's still holed up with the German bankers when our interview is due to start.
Fifteen minutes later, the Mayoman sweeps breathlessly into the room, full of apologies. "One of those days," he says ruefully, as he investigates the refreshments situation.
The topic of the day is supposed to be Vista, the McEvaddys' €25m Naas healthcare centre which marked its first year last week, but McEvaddy talks far more expansively on his two main passions -- politics and planes.
A long-time Fine Gael member, McEvaddy broke on to the national political stage a few years back with his outspoken opposition to the "unintelligible" Lisbon Treaty.
More recently, he's turned his attention to the banking crisis --he's not a fan of Nama or of nationalisation, and he believes the banks could be capitalised "overnight" if the Government made deposit interest tax free, therefore encouraging the public to plough in their savings.
George Lee also comes in for a mention given the week that's in it: "I think they over-hyped him in the first place, he was always a doom and gloomer, listening to him, I'd always think, 'for God sake George, would you stop it?'"
The politics done, it's onto the planes. Aviation is what propelled the McEvaddys into the business big leagues, as their start-up Omega Air developed a global business spanning everything from engine overhauls to refuelling services for the US military.
Aviation is also what first brought the McEvaddys into the national spotlight on their home turf as they fought to develop a 140-acre tract of land they own into a terminal for Dublin Airport. And aviation is where their next big play lies, as the brothers engineer a €700m commercial development near Berlin's new airport, the very project that brought the Deutsche bankers to their Dublin office last week.
"It's absolutely still on schedule," McEvaddy insists, as he leafs lovingly through a series of aerial shots showing his two Berlin sites from endless angles. "We have full planning permission for the main site, the roads are going in and the rest of the infrastructure is too."
The next hurdle for the massive mixed-used development is financing. The McEvaddys are backing the development along with a handful of other Irish investors.
"It's hard (with the banks)," McEvaddy admits. "The maximum loan to value you'd get now would be 70pc, but that should be enough for us. We've covered all the development costs, so it'll be a year or so before we need any money but we've started working on it already."
Given the credit crunch and the economic collapse, McEvaddy must be glad at least that he never managed to get the necessary approvals for his €450m Dublin Airport terminal.
"Not at all," he says. Dublin Airport may be shedding passengers at the rate of almost 20pc a year, but McEvaddy says the airport's own second terminal "will be full within a couple of years". And he still seems hell-bent on adding his third terminal to the mix, just as soon as either the courts or the Competition Authority give him access to the airport's runways.
"I sure am building my terminal, it's just a question of when," he says. "Watch this space."
An Omega staffer interrupts McEvaddy mid-flow. There are documents to be signed, and he's got less than half an hour to make it from Omega's Dublin Airport office to a meeting on the city's southside. With the clock closing in, McEvaddy turns his attention to Vista. The venture "lost about €3.5m" in its first year, he admits candidly, and will "probably" lose another €1.5m in 2010. "That's start-up costs for you."
Losses aside, McEvaddy says the first year proved that the Vista concept, where primary healthcare services, diagnostics and minor surgical procedures are all carried out under one roof, works. He adds that the year has further convinced him that "primary healthcare is the way to relieve the pressure on the health service".
Despite that enthusiasm, Vista's wider plans for a network of five to six centres remain on ice, and a site already purchased in Mayo won't be developed for at least two years. "I wouldn't expand it in the current financial climate but I will later," says McEvaddy, "let me get this one (in Naas) stabilised first."
A knock on the door reminds him that he has to leave immediately or postpone his 4pm meeting. "I've already postponed it once, I'd better go," he says, shaking his head before disappearing down the hall for another speedy round of signings and consultations.
"There's just not enough hours in the day," he says, as he waits impatiently for the lift. On the way down, the conversation turns to Omega, the one topic McEvaddy always tries to avoid talking about.
Omega is known to be big -- in 2008 it won a five-year contract worth $250m (€182m) with Britain's RAF -- but just how big or profitable is anyone's guess. Why so secretive?
"When you're in the military business you don't want anyone else knowing what you're doing," McEvaddy replies as he whizzes out of Omega's carpark, bravely navigating his way through lanes of traffic.
He lets slip that a "big contract" could be coming up and that the firm "made money last year", but a request for a ballpark turnover figure is less successful. "Sorry, can't tell you that," the founder smiles, propelling his car through an almost-red light, while insisting he has no penalty points.
He's more chatty on the less sensitive aspects of Omega's Irish business, however. The firm, like every firm in the country, has been hit by the recession but it hasn't had to let go of any of its Dublin or Shannon staff. "We looked at the market and came up with another type of engine we could overhaul, we're starting that here (in Dublin), in the next six to eight weeks," he says. The move will see Omega hire about 20 extra Dublin staff over the next couple of months.
Entering the Port Tunnel, McEvaddy turns to more philosophical matters, including the plight of Ireland's embattled developers. "If I'd invested heavily in the property market it could have been me," he says, reflecting on his remarkably prescient decision to offload his Irish property portfolio "four or five years ago".
The only Irish property that remains on the books is the Dublin Airport land, which the brothers have written down by about 40pc. "It helps with tax, but we're not going to sell them, they're strategic holdings," he says.
The remainder of the journey spans his experience of being overleveraged -- "when an R&D project you thought would cost €30m ends up costing you €65m" -- and why he likes the Democrats more than the Republicans since "Republicans give the military what they want" whereas Democrats leave the military needing to buy in services from the likes of Omega.
Less than 20 minutes after leaving the airport campus, McEvaddy is powering down Barrow Street to meet his solicitors, still chasing his tail.