Michael Daly, the managing director of the Abu Dhabi-based water technology company Bin Moosa & Daly, knows he has been filling some pretty big shoes running a business that was started by his father 50 years ago.
Mr Daly describes his late father, who was also called Michael, as “quite a pioneer”.
His father was one of 12 children born in a village in County Cork in the Republic of Ireland to a farmer.
“Only the eldest inherited the farm, so the rest of them took off,” Mr Daly says. “My grandmother told me that he was such a troublemaker, they were glad to get rid of him.”
Mr Daly senior went to London, where he joined the Palestinian police force, with whom he served for two years before moving into the oil and gas industry. He spent the next 20 years working in the sector, and eventually found himself in Abu Dhabi, where he worked for BP teaching engineering to local students. Eventually, though, he tired of working for others and gained permission directly from the UAE's Founding Father, Sheikh Zayed to start a trading business in Abu Dhabi in 1967, later teaming up with one of his former students, Sayyah Moosa, who became his local sponsor.
Yet Michael junior has not exactly been resting on his laurels. When his father passed away 10 years ago, the company had a turnover of Dh66 million. It now turns over Dh160m and employs 180 people across the UAE.
The firm started life importing building materials and became an agent for bringing in pumps from the Australian company Davey. It then started to manufacture pump sets with back-up systems and control panels, initially employing “a couple” of engineers in the 1980s. Since then, it has become Davey’s biggest overseas customer, and the engineering staff has grown into a 60-strong team working from an industrial facility in Musaffah. Bin Moosa & Daly also employs 50 people through a store network in Al Ain, Abu Dhabi, Dubai and Sharjah, as well as stores and head office staff.
Mr Daly says the increase in business over the past decade has been spurred on by a couple of factors. One has been the growth in demand for pump sets, which are used to generate water pressure within buildings - be it villas or apartment blocks.
“It’s not like the UK, Europe and the US where you have pressure in the house from the mains. In this country, and I think most of the [Arabian] Gulf, the water supply mostly comes into your ground tank. If it’s a building, or a villa, their responsibility is just to give water to your property. You have then got to pressurise it, which is good for us because it means we sell a lot of pumps.
“We do 300 to 400 sets per month,” he adds. “At the peak, five or six years ago, we were doing 500 to 600 a month, but that was when business was really booming. Those were the days where you couldn’t make enough.”
This growth has been tempered somewhat by macroeconomic conditions with the lower oil price, meaning there has not been as much building work taking place in the capital and, therefore, not as many new pumps are required. But Bin Moosa & Daly has also diversified into other, lucrative markets.
For instance, it signed a deal five years ago with Diehl, a German producer of smart water meters, to become its agent in Abu Dhabi. These meters are used by the Abu Dhabi Distribution Company and the Al Ain Distribution Company when connecting new properties to the grid and when replacing old meters.
"Over the last five years, we'e supplied more than 130,000 meters," Mr Daly says. " Abu Dhabi buys 35,000 meters a year. Dewa wants to buy 300,000, but we're not the agent in Dubai."
He said the smart meters are important for two reasons. First, they can be read remotely either through radio signals, Wi-Fi or other methods. Second, they provide lots of important data for billing and for analysis of water consumption, which is important in terms of helping efficiency initiatives.
Bin Moosa & Daly's other major area of business growth has been providing solar water heaters from the German manufacturer Wagner Solar and Spain's Termicol.
Mr Daly makes clear that his interest in solar is largely limited to solar water heaters, not electricity-generating kit - “we’re not interested in PV, we’re water technology” - but he still believes there is plenty of scope for further expansion.
“Solar will be a major part of our business,” he says. "It is compulsory on all new projects in Dubai and it is recommended in Abu Dhabi.”
The company recently delivered solar water heating systems to 98 new villas that were built in Al Ain by Nael General Contracting.
Mr Daly says that when importing goods such as water heaters either from Europe, Australia or other parts of the world, currency fluctuations need to be accounted for. Although the weaker pound has made importing goods from Britain cheaper, growing demands from clients for fixed prices on contracts that run for two, or even three, years, means the firm needs to hedge exchange rate risks with its lenders.
“We have to hedge currency with banks. They don’t like doing that for more than a year. It’s quite expensive.”
He also says that as much as it has developed longstanding relationships with many of its suppliers - most of whom were flown into Abu Dhabi for the company’s 50th anniversary celebrations in April - it cannot fix the prices at which manufacturers sell to it.
Suresh Ponnuru, Frost & Sullivan’s programme manager for its industrial automation and process control business, says the demand for water pumps in the UAE has declined over the past two years, “but is expected to regain pace from this year”.
"The global crude oil price crash in 2014 and 2015 has had a cascading effect on the GCC markets, including [the] UAE," Mr Ponnuru says. "The residential market has seen a dip in project completions in 2015 and 2016, due to unfavourable economic conditions. Due to lower demand and oversupply of residential properties in 2016, developers delayed their projects."
Despite this, his company has predicted that the market will be worth US$108.1m by 2020, up from $83.4m in 2014. Frost & Sullivan says new build projects account for just 36 per cent of overall demand for residential water pumps. The market for replacement pumps is much larger, making up the remaining 64 per cent.
So it seems a good bet that Bin Moosa & Daly will clock up another 50 years.
mfahy@thenational.ae
