Almost 30 years after Sonny Berry started a charter air service to subsidize his flight time in a small two-engine airplane, Berry Aviation Inc. can now be found around the world setting up operations in remote locations, equipping and operating planes with surveillance equipment, and shuttling sports teams and rock stars.
Company executives have even bigger plans for 2012, having recently issued $500,000 in preferred stock and taken on $19.1 million in debt — transactions facilitated by Austin-based Focus Strategies Investment Banking. Berry Aviation plans to use the money to handle more government contracts, expand domestically and take on private sector work in Africa in the coming year.
In 2011, the company ran 13,000 flight operations in 24 countries covering almost 2.5 million miles. Berry Aviation made more than $50 million in revenue and increased its fleet to 23 aircraft. The company has 200 employees and plans to hire 10 to 45 more workers, depending on the number of airplanes it adds to its fleet this year.
Company executives anticipate revenue of more than $60 million in 2012, with a large portion coming from government contracts.
“We’re a niche company that specializes in hard-to-do things,” said Berry, the company’s president and a third-generation Texan. “We’re always looking for different work.”
That diversity appears to have sprung from necessity. Stan Finch, director of operations at Berry Aviation, joined the company in 1986 during tough economic times.
“We were running out of things to do with airplanes,” Finch said.
That’s when the company started bidding on government contracts. It was awarded its first one in 1987.
Flying the unfriendly skies
Berry Aviation has since become a certified air carrier by the Department of Defense and the Federal Aviation Administration, and has had contracts with all branches of the U.S. military and other government organizations. The company also has high-level facility clearance from the Defense Department.
“We have gained experience in the past 10 years setting up operations in remote locations,” Finch said, “which must be done quickly because these places are often not secure.”
This experience has proved very lucrative for the company. When Berry Aviation obtained contracts with the Defense Department’s Narcoterrorism Technology Program Office for services at two bases in Afghanistan in 2010, the company went from making $20 million in revenue to $51 million in 2011.
The contracts are worth up to $171 million if all the option years are exercised, Finch said. He said he doesn’t believe the draw down of the masses of troops will affect their mission in Afghanistan anytime soon.
Meanwhile, through other government contracts, the company provides air support at the Ronald Reagan Ballistic Missile Defense Test Site on the isolated Republic of the Marshall Islands and shuttle service between two U.S. Navy sites in California.
In the past, Berry Aviation was hired to help with the demolition of Johnston Island, an unincorporated U.S. territory west of Hawaii.
Berry Aviation has been hired by other governments also.
The company is working with the Peruvian government to outfit planes with intelligence, surveillance and reconnaissance equipment, including cameras that can read a wristwatch from 30,000 feet in the air, Finch said.
Africa and auto parts
The company has landed some private sector work in Africa for 2012 and has the potential to operate in Chad, Uganda and adjacent countries, he said.
The company’s domestic expansion plans include adding three airplanes dedicated to cargo transport for carrying auto parts and oil drilling equipment.
“The auto industry is starting to expand again,” Berry said, “and there are few competitors in this niche market.”
Customers need their parts on time or their production line will go down, Berry said. Berry Aviation can charge $30,000 for a single trip and made $3 million from transporting auto parts in 2011.
Finch attributes part of this success to a loading system it developed that gives it a competitive advantage and to one employee’s business connections.
Because of the work it does and the places it goes, Berry Aviation has an interesting collection of employees, Finch said. Many of them are expatriates, and many of the company’s opportunities come through the employees, he said.
Safety has always been a top concern for Berry.
“If any [employee] wants to refuse a mission, they can,” Berry said.
Despite the treacherous work, the company has had no accidents or fatalities in its 28 years of operation. Berry Aviation spends about $3.5 million on insurance annually and tries to mitigate costs by visiting with insurance brokers in London, Atlanta and New York each year.
Its reputation for safety helped the company become the only contractor to be able to fly at night and in the clouds in Afghanistan in one year, although several other aviation companies had been there longer.
From the dispatch room at the company’s corporate headquarters at the San Marcos airport, Berry Aviation employees can communicate with the pilots and monitor where planes are in real time.
Berry started the company in 1983 with one small twin-engine Piper Seneca airplane based at Austin’s former Robert Mueller Municipal Airport. He made $10,000 in the company’s first year as a one-man operation.
The company still runs private charter flights, but it has gone from flying fraternity boys and their dates out to the coast to jetting touring musicians, college athletes, NASCAR teams and Fortune 500 company executives; however, it does not market to these niche groups. In 1993, Berry Aviation moved to San Marcos after the community south of Austin courted the company, which had 20 employees at the time.