Gerry Ryan says election puts Jayco back on the growth road

Jayco millionaire Gerry Ryan says Labor’s defeat was a turning point for his caravan business.

Gerry Ryan renovates

Gerry Ryan has declared the recent federal election a turning point for his Jayco, revealing uncertainty caused by the Labor opposition’s proposed tax changes had caused sales to fall at his caravan manufacturing giant for the first time in almost a decade.

Ryan says Labor’s proposed franking credit changes had worried retirees, who make up a large proportion of Jayco caravan buyers, and a slowdown in some tourism numbers had also hurt.

All of that added up to a fall in sales for Jayco in the 2018 financial year, after revenue of about $524 million in 2017, though Ryan says he has noticed a recent change in sentiment.

“There’s no doubt confidence took a hit and retirees were worried about their franking credits and stopped spending,” Ryan tells The Weekend Australian.

“You could see that in sales and you also had inbound tourism take a hit at times, with people also being worried about the US and China situation as well.

“But definitely since the election we have seen a lift (in sales), it has been quite noticeable. And we’re coming off six years of record profits, so we’re going all right. But we think we will get a considerable boost in the coming months.”

There would be few business identities with portfolios as diverse as those of Ryan, who as a member of The List — Australia’s Richest 250is estimated to have a $488m fortune.

While Ryan and his family maintain ownership of Jayco, which he founded in 1976 with a $10,000 loan and built into an Australian manufacturing success story, he stepped away from day-to-day management four years ago and has devoted more of his time to his hospitality and sporting interests.

Ryan owns hotels in Melbourne such as The Prince in St Kilda, a famous concert and event venue undergoing a refurbishment that has revealed some historic rock ’n’ roll posters on its walls, and the Mitchelton winery and hotel near Nagambie in rural Victoria.

Then there are his sporting interests, which extend from a shareholding in NRL side Melbourne Storm, ownership of the Mitchelton-Scott professional cycling team to sponsoring the women’s basketball club Dandenong Rangers.

Ryan even tells The Weekend Australian about his latest Melbourne Cup horse racing interests, having already had shares in two winners with Americain in 2010 and then Rekinding in 2017 with another member of The List, Lloyd Williams.

Mitchelton-Scott's Simon Yates on his way to victory in the 2018 Vuelta a España Picture: AFP

This year, Ryan has high hopes for Master of Reality, one of the early favourites for the Cup, and Furrion in the Caulfield Cup.

“All work and no sport makes Gerry a bit dull and restless,” he says with a laugh.

But this time of the year mostly means the Tour de France, with Ryan late this week setting off for Europe ahead of cycling’s most prestigious event starting next Saturday night Australian time.

While he is reluctant to talk numbers, Ryan has probably poured more than $40m of his own funds into the Mitchelton-Scott team since its inception in 2012.

Like most cycling teams, Ryan’s outfit changes its names depending on its major sponsor deal. Earlier in its history, Ryan convinced ASX-listed explosives firm Orica to take the naming rights for an estimated $7m annually but is carrying more of the cost this season having put his Mitchelton brand on the team.

But he is hopeful of a change in the team’s financial situation soon. “Mitchelton was always a stopgap. But we are hopeful of having a solution in the next 30 days and we are in talks with several potential sponsors to step up. That includes one major sponsor and several under that.”

The team has become one of the more popular on the global circuit under Ryan’s leadership, with its social media content attracting big viewer numbers and the team was even the subject of a movie-length documentary two years ago.

It has also won several classic races, the Tour Down Under, some Tour de France stages and last year broke through to clinch its first truly major event when its British rider Simon Yates won the Vuelta a Espana, one of the three grand tour races.

Can the Ryan team go one step better and win the tour? He is hopeful of some stage wins, but admits it is tough for any of the teams to compete with Team Ineos, which is owned by one of the richest Britons, billionaire Sir Jim Ratcliffe, and is said to have an annual budget of £35m ($63m).

“They’ve got a budget double the size, and that’s free enterprise for you,” says Ryan. “And while there’s been talk of a salary cap, nothing has really come of it yet. We think we can win some stages potentially and we’re set up for general classification races now.

“Adam (Yates) is our hope and the way we go is we have his brother Simon for the Giro d’Italia, Adam for the Tour and Estaban Chaves for the Vuelta later in the year. And we will have a good crack and see how we go. You just never know on the day.”