Business and Finance Roundup for the UK and Spain

Home comforts WORKING from the office should be employees’ default mode, according to the UK’s Chancellor, Jeremy Hunt.

Speaking on May 17 to business leaders attending the British Chamber of Commerce conference in London, Hunt said that working from home could stifle creativity.

He added that he believed  firms were gradually reversing the shift to teleworking that began during the Covid-19 pandemic.

Despite the Chancellor’s conviction that employees would return to offices “unless they had a good reason not to”, flexibility was a top reason why employees accepted new jobs, post-Covid research confirmed.

In deciding between jobs with similar pay or benefits, the opportunity to work flexibly could become a deciding factor, investigators found.

Aussie takeover THE GMB union wants the government to intervene if Australian banking group Macquarie gains control of a vital section of the UK’s gas grid.

The Macquarie Asset Management-British Columbia Investment Management Corporation consortium acquired 60 per cent of the equity in National Grid’s gas transmission and meter business in a £7.5 billion (€8.6 billion) deal last January.  This covers 4,000 miles (6,437 kilometres) of gas pipes.

According to the Guardian, a clause in the deal allows the consortium first refusal to buy the remaining 40 per cent later this year.

Center Parcs sale THE Center Parcs chain of holiday villages has been put up for sale by its owners, the Canadian private equity firm Brookfield.

The company, which bought the business for approximately £2.4 billion (€2.77 billion) in 2015, expects to raise between £4 and £5 billion (€4.61 and €5.76 billion), the Financial Times said.

Center Parcs real estate was independently valued at £4.1 billion (€4.7 billion) in April and Brookfield has also spent £100 million (€115.19 million) on technology upgrades.

Revenues for the year ending April 21, 2022, reached £503.4 million (€571.9), with £245.6 million (€282.9) profits returning the company to the black following 2020-2021’s pandemic losses.

No quick solutions MARGHERITA DELLA VALLE, Vodafone’s new chief executive, confirmed on May 16 that the company would “strategically review” the future of Vodafone España.

The telecoms company faced stiff competition in a country that was “obviously very complicated”, Dell Valle acknowledged on the same day that she announced worldwide staff reductions of 11,000, approximately 10 per cent of Vodafone’s workforce.

She was reluctant to specify whether this review envisaged a sale of Vodafone Spain, as analysts already suspect.

“We cannot jump to conclusions about the steps we will take,” she said, while admitting that there were no quick solutions for Vodafone’s Spanish business.

The company had a turnover of €3.9 billion in its fiscal year that ended on March 31, a 6.5 per cent reduction on the previous fiscal year’s €4.18 billion.

Google’s Spanish profits GOOGLE SPAIN made a €44.7 million profit in 2021, a 79.5 per cent increase on 2020.

Income rose to €214 million, 44 per cent more than during the previous year, thanks to increased demand for the company’s services, according to Google Spain’s accounts filed with the Registro Mercantil.

As is habitual with US technology multinationals who operate abroad, these figures accounts do not reflect the company’s real business in this country.

Google Spain registers its sales in Ireland and only takes into account earnings from marketing and support services to Google Ireland and research and development services for Google LLC.

Sorry about that HUW PILL, the Bank of England’s top economist, apologised for suggesting that people should accept they were poorer.

Censured by unions, businesses and the public, Pill’s critics included his own chief, the governor of the Bank of England Andrew Bailey, who said the economist’s choice of words “was not right.”

“If I had the chance again, I would use somewhat different words to describe the challenges we all face,” Pill said.

“Although we have some difficult messages to bring. I will try to bring them in a way that is perhaps less inflammatory than maybe I managed in the past.”

Come hither offers  SPANISH banks continue to vie with each other to attract new customers.

Banco Santander, for instance, promotes online accounts by paying €50 for each recommendation resulting in a new customer whose salary is paid directly to the bank.

The new customer also receives €150 thanks to this offer which ends on June 12.

Another Santander offer, which continues until June 30, pays €150 to new customers who open an account and pay in a monthly salary of at least €600.  This rises to €350 for salaries of more than €2,500.

Apollo backs off PRIVATE equity firm Apollo abandoned its £1.66 billion (€1.91 billion) takeover of the oil and gas services company, Wood Group.

The Aberdeen-based company said earlier that it would “engage” with Apollo’s final offer of 240p (€2.76) per share, after rejecting four earlier proposals which it said were too low.

Instead the New York firm announced on May 15 that it would not make another offer for the business, two days before the deadline for making a firm bid or turning its back on the deal.

Taxed to death SIR JIM RATCLIFFE, one of Britain’s richest men, warned that the UK government’s windfall tax could destroy the North Sea’s oil and gas industry.

“Taxes are so high that profits no longer fund future investments,” the Ineos chemicals group founder told the Financial Times.

The government resorted to “primitive politics” when Rishi Sunak, who was Chancellor at the time, put an extra 25 per cent tax on industry profits following Russia’s invasion of Ukraine. This was later raised to 35 per cent by Jeremy Hunt, who took over as Chancellor.

Ratcliffe argued that the levy – in effect a 75 per cent tax on North Sea profits which helps to fund government support schemes for household fuel bills – jeopardised the energy industry.

No thought was given to the long-term consequences of this “tax it to death” concept he said.

Unravelling the Banco Popular tangle THE European Central Bank (ECB) had never expressed concerns about the situation of the defunct Banco Popular.

José María Sanz Olmeda, a PwC audit partner who examined the Banco Popular  books between 2009 and 2015, told a investigating National High Court judge that he detected “no anomalies” during this period.

Meanwhile, the ECB decided on 6 June 2017 that Banco Popular was “failing or likely to fail” and notified the Single Resolution Board.

According to the financial daily, Cinco Dias, legal sources familiar with the proceedings maintained that this was one of the cases “most relevant testimonies.”

This, they say, could clarify contradictions in various reports from expert witnesses regarding whether or not the Banco Popular should have reflected losses before the 2016 capital increase of more than €2.5 billion.

Kid glove treatment NEW regulations coming into force on July 31 will ensure that people receive better treatment from companies providing them with financial products.

Banks, building societies, insurers, investment firms and other businesses have been warned to prepare for one of the UK’s biggest-ever consumer-finance upheavals.

The Financial Conduct Authority’s new regime will see the introduction of the “consumer duty,” which sets higher and clearer standards of protection, while explicitly requiring companies to put customers’ needs first.

The FCA want the initiative to produce “good outcomes” for consumers, with reduced call-waiting times, an end to rip-off charges and fees, plus easier procedures for cancelling or switching investments.

Digi digs in SPAIN’S mobile phone operators announced their first quarter accounts in a period that was dominated by fierce competition from the low-cost segment.

Rumania-based Digi again demonstrated its strength compared with the bigger companies’ modest growth while the sector is at fever pitch owing to the MasMovil-Orange merger and the Vodafone crisis.

Digi, meanwhile, increased its earnings by 29.4 per cent to €143.3 million, owing to its aggressively low tariffs.  At the same time, the company’s commercial aggressiveness also reduced the average spend per client by 4.1 per cent to €9.3.

No break SEAT plans to take on 900 temporary workers between June and September to ensure that production need not be affected during the holiday period. Above all, this should prevent the Martorell (Barcelona) factory from having to close in August and allow the plant to produce an additional 14,000 cars, principally the Cupra Fomentor model.

Wind power  ARDIAN, a leading private investment company, agreed to sell for an undisclosed sum its ASR Wind portfolio of 12 windfarms as well as a hybrid solar energy plant, to Naturgy, the Spanish renewable energy group. The windfarms, which are located in several regions across Spain and have 422MW of installed capacity, were all built between 2005 and 2012.

Boo-hoo! ONLINE fast fashion retailer Boohoo.com plunged almost £91 million (€105 million) into the red as annual sales dived and the retailer had to cope with higher levels of returned products.  The label aimed at the 16-30 age group announced that sales fell 11 per cent to £1.8 billion (€2.1 billion) in the year ending on 28 February.

Going up CURRYS increased its annual earnings outlook following better-than-anticipated sales across the UK after initially reducing its full-year prediction to £104 million (€120 million).  The electrical goods retailer adjusted its forecast and now expects pre-tax profits of between £110 million (€126.8 million) and £120 million (€138 million) for the 12 months ending on April 29.