FUTURE PROOF Connolly's Red Mills: Connolly's Red Mills is busy seeking overseas markets for its feeds and has galloped ahead of the competition in China

JOE CONNOLLY’S jetlag is an annoying side-effect of his happily thriving business. Just back from a trip that took in China, India and Malaysia, the managing director of animal feed maker Connolly’s Red Mills says that despite the sleep deprivation, he gets a “great buzz” out of flying to far-flung places to find new markets for his product. China opened up in April with a final go-ahead for a licence to import horse feed – the first firm to be given such a licence.

Beijing and Kuala Lumpur are a far cry from the humble origins of Red Mills in Co Kilkenny where Michael Connolly, Joe’s grandfather, returned from the US in 1866 on hearing he had inherited a bakery from his uncle.

In 1908 Michael bought a mill in Goresbridge and the family began grinding their own corn for the bakery. The business modernised and continued to grow, making porridge oats for humans and feed for piglets with a new generation of Connollys at the helm – including Liam, Joe’s father.

In 1963, the direction of the business was changed dramatically when local horse trainer Paddy Mullins called to the mill to see if something could be done for a horse he had with an eating problem. After a special feed was concocted, Vulpine not only overcame his eating problem but went on to win the Gold Cup in 1966 and the Grand National in 1967. “People wanted to know what he was feeding the horse and, of course, they started to develop those feeds,” says Connolly.

Red Mills began in earnest to supply to the Irish horse-breeding community and, in 1986, started exporting to England. Over subsequent years it began to supply to Germany, France and Sweden. But travelling long distances with the feed was problematic since it had to be kept fresh. After a special vacuum pack was developed and difficult Australian quarantine laws were overcome, a Red Mills-fed horse, Vintage Crop, won the Melbourne Cup in 1993 – the first win for an overseas-trained horse.

“Altogether now we have fed four northern hemisphere-trained winners of the Melbourne Cup. Our feeds are world beaters,” says Connolly, whose brothers help run the company with him along with the next generation of the family.

Although horse feed is now the more visible aspect of the business, since Red Mills also sponsors races in Ireland, the company also produces malt and barley for beer production, grain for flour and animal feed, oats for human consumption and pet food. Turnover in 2011/12 was €100 million and the company has 250 employees worldwide.

During the last decade, Red Mills has been involved in a number of acquisitions including Rothwell Grain Seed and Foran Equine Products.

It hasn’t been all good news. In 2002, a contaminated batch of poppy seeds saw 37 horses disqualified from races in England and Ireland because they were considered to have been doped. Customers were compensated but Connolly says the period was a difficult one for a company so dependant on its reputation. “I didn’t sleep with the worry. What we were going to do next was paramount,” he says.

The recession has also inevitably had an impact, with sales falling back some 15 per cent. However, that has started to improve in the past year, Connolly says. The way to fight such a downturn is to continue diversifying, he adds. “Nobody can stand still. You have to spread to other interests to lessen the risks to your business,” he says. As a result the company invests in research and development, and continues to seek acquisitions.

China is not the panacea to any future downturns either. Connolly expects the country to lift its ban on gambling in the coming years thereby creating further demand for thoroughbreds but he knows that risks remain.

“Our most important business is our home business. China will do its best to develop but there are risks we are conscious of, such as cost of transport, shipping, the strength of the euro, whether the Irish pound comes back into vogue and whether it will be competitive,” he says.

For a business that has been around for over 100 years and has witnessed major setbacks, Connolly says Red Mills is braced for whatever comes along.

“If you don’t think positive you’re dead,” says Connolly.