Business Roundup for Spain and the UK

Strike a light THE National Competition and Markets Commission (CNMC) is investigating 35 of Spain’s small and medium-sized electricity suppliers.

Following reports in the El Pais and El Confidencial newspapers, the CNMC now suspects that Holaluz, Cox, Fenie Energia, Alpex Iberica, Alterna, Neuroenergia and Som Energia amongst others, have been taking advantage of the Iberian exception.

Thanks to the European Union concession which has temporarily reduced the price of gas and electricity in Spain and Portugal, the suppliers allegedly bought electricity on the Spanish market at a favourable price and selling it on to France.

The investigation began in mid-March although the CNMC, as always with its investigations, said that it could not provide any further details.

In-person preferred A RECENT survey found that a third of the UK population would rather do their banking in person.

Meanwhile, high street banks maintain that in-person services are underused although the survey found that people wanted person-to-person advice even when they were computer-literate and could obtain it online.

Forty-four per cent of over-55s said they would rather visit a branch but the survey  by professional services company, Accenture, found that not only older generations were reluctant to switch as the 18-34 age group also hesitated to switch entirely to online banking.

More people were using the Post Office to manage money as a result of branches closing, which often made it the only location where consumers and businesses could do their banking..

More banks closing meant more cash was handled by the Post Office in March than any month since last September, excluding Christmas. New figures from the company revealed over the counter deposits and withdrawals cross its 11,500 branches reached £3.29 billion (€3.73 billion) last month.

The great getaway DESPITE the cost-of-living crisis, spending on flights and holidays rose in the first three months of 2023.

Details from more than 24 million UK bank accounts showed a 27 per cent year-on-year rise in package holiday bookings, and a 36 per cent increase in spending on airfares, according to analysis by digital advertising platform Cardlytics.

While all the travel industry has enjoyed a post-Covid rebound, figures suggest a trend towards low-cost options. ,as budget airlines are up 42 per cent year-on-year compared with 29 per cent for more expensive carriers.

Best-ever start BANKINTER had an excellent start to 2023.

The bank headed by Maria Dolores Dancausa reported first-quarter profits of €185 million, 20 per cent more than in the same period last year and Bankinter’s best-ever figure for the January-March period.

This also takes into account the €77 million that Bankinter paid out as the first instalment of the temporary windfall tax introduced last year to fund government measures brought in to ease the cost of living crisis.

The stock market immediately responded with a 5 per cent increase in Bankinter shares  although this later fell back to around 2 per cent.

Mammoth Aena contract STATE-OWNED airports operator Aena is putting out to tender a five-year, €1.5 billion contract for private security.

What is possibly the Administration’s largest-ever services contract requires approximately 5,500 security guards and 2,000 assistants for Aena’s 45 airports, two helipads and Murcia aerodrome.

These will be required to provide adequate security at Aena airports which foresee 286 million arrivals during 2023, rising to 288 million in 2024, 301 million in 2025 and 315 million in 2026.

Insiders familiar with the contract specifications told the Spanish media that this offered the option of an additional year, to provide the chosen companies with as much stability as possible.

A health unto His Majesty NYETIMBER, which produces English sparkling wine, predicted bumper sales this summer.

Eric Heerema, Nyetimber’s chief executive and chairman, said the Sussex-based company was expecting “strong demand”’ over the Coronation bank holiday.

Sales had already surged in recent years, Heerema pointed out, thanks in part to warmer weather which favoured productio and shot up by 60 per cent over the late Queen’s Platinum Jubilee weekend.

Glasses of Nyetimber wines, which have been served at numerous royal events, will be raised again throughout Britain during and after HM King Charles III’s coronation on Saturday, May 6.

Nyetimber, like rival Chapel Down, is launching a £39.50 (€44.83) limited edition wine for the Coronation, made from West Sussex grapes.

“Consumers are always proud to champion and celebrate British goods and craftsmanship,” Heerema said.

Home help THE Bank of Spain (BDE) revised the number of mortgages eligible for social protection measures agreed with the government and finance sector in late 2022.

The updated and extended Code of Good Practice was expected to benefit one million vulnerable households and those at risk of defaulting on mortgage payments.

Instead, Spain’s supervisor calculates that this would assist 550,000 families should the interest rate rise from the current 3.5 to 4 per cent.

Nevertheless, past figures for households accessing the 2012 Code also suggested that only 200,000 households would benefit, according to the Bank of Spain’s latest Financial Stability Report.

A smooth ride NATIONAL EXPRESS reported a rise in first-quarter revenues thanks to its UK buses and German rail improvements.

Overall earnings rose by 25 per cent to £774.4 million (€879.7 million), consistent with expectations, while Spanish subsidiary ALSA reported solid growth, especially on long haul and Morocco routes.

UK earnings rose 27 per cent year-on-year, with scheduled coach revenue up 87 per cent on 2022, reflecting the recovery from the Covid-related restrictions 2021 and the impact of rail strikes.

Thanks to its first-quarter results, National Express shares immediately rose 4.25 per cent after having fallen by around 48 per cent over the 12 months.

The company’s German rail interests rose 10 per cent on 2022 while it expects a 13 per cent price increase on the US bus contracts once these expire.

Meter pact ENERGY FIRMS agreed to ban forcible installation of prepayment meters in the homes of customers who are over 85.

Representatives must in future wear body cameras as part of a new code of conduct, the Guardian revealed.

Suppliers reached agreement with the government regarding new guidelines for installing the meters in situations where householders have run up an energy debt. There will be no repetition of agents brandishing court-approved entry warrants to break in to install them, power companies pledged.

They must now make at least 10 attempts to contact a customer and then conduct a “site welfare visit” before a prepayment meter is installed.

An American suitor US INVESTMENT fund, Apollo Global Management, has the John Wood Group in its sights.

Usually referred to as Wood, the multinational engineering and consulting business headquartered in Aberdeen turned down four previous offers, maintaining that they did not reflect its real value.

Matters changed with the fifth, which valued Wood at £1.66 billion (€1.84 billion), 59 per cent more than the share price before the first offer was made.

The board of directors listened to Wood’s investors – mainly big institutional funds – and decided to open the books to Apollo.

This follows a steady decline in Wood’s share price, partly to the problematical £2.2 billion (€2.5 billion) takeover of US engineering giant Amec Foster Wheeler, and attempts to diversify from oil and gas.

The original deadline for a decision has now passed and has been moved to May 17.

Raise a glass HEINEKEN has finished the first quarter of its fiscal year with buoyant sales in Spain.

The multinational brewing company reported that its net income grew by more than 20 per cent owing to increased volume and the combination of channels and brands.

Sales of the O.O.. non-alcoholic brand performed exceptionally well in Spain, together with the entire premium range led by El Aguila.

In addition, Spain is one of six markets that have completed the transition to Eazle, one of the  largest e-commerce platforms in the world, the company said.

Flat batteries AMTE Power, a small producer of lithium ion batteries, initially intended to build its first factory capable of large-scale production in Dundee.

The company recently told Sky News that it was considering whether to switch from the UK to the US where it would benefit from American subsidies under the Inflation Reduction Act.

“Unless we can make the UK a competitive place for battery manufacturers, we probably won’t end up with a battery manufacturing industry in the UK,” AMTE Power’s chief executive Alan Hollis said.

Store buys back shares EL CORTE INGLES has paid a total of €500 million to finalise its deal with  Sheikh Al Thani.

With this transaction, the department store group acquired 4.2 million of its shares, representing 5.53 per cent of the group’s capital and half of the 10.33 per cent owned by AI Thani through Luxembourg-registered Primefin.

El Corte Ingles repurchased these shares in June last year in an operation originally valued at €385 million. The final amount was increased to €500 million to include compensation and interest, principally as compensation to Primefin which granted a €1 billion loan to El Corte Ingles in 2015.

Big cuts by big names LONDON-BASED accountancy firm Ernst & Young (EY) is cutting 3,000 jobs in the US, citing overcapacity in some parts of the company.

Days earlier, EY had abandoned plans to separate its auditing and consulting divisions although the company maintained that the staff reductions were unrelated to that decision.

Instead, the cuts affecting approximately 5 per cent of its US workforce were part of its ongoing management of the business, said EY, promising “comprehensive support” to those affected.

The move came as US firms prepare  for an economic downturn.

EY rival KPMG is also said to be cutting jobs in the US, while both Accenture and McKinsey are among the big names announcing redundancies.

Accenture is slashing 19,000 jobs – approximately 2.5 of its personnel – while McKinsey is reportedly divesting itself of 1,400 employees or 3 per cent of its staff.