Friday 15 December 2017

What it says in the papers: business pages

Paul O'Donoghue

Here are the main business stories from this morning's papers:

Irish Independent

***Eircom has paid out refunds of €700,000 in total to almost 12,000 customers for landline outages that lasted over 10 days during the first three months of 2014.

The operator, which has also agreed to compensate those who suffered landline outages in the last three months of 2014, agreed to the payout after a legal settlement with the telecoms regulator, Comreg.

The settlement involves refunds of €600,000 to residential customers and €100,000 to businesses which found themselves without landline services for more than a week-and-a-half, between the end of December 2013 and April 30 of last year, a period when the country was battered by high winds and storms.

***The chief executive of EasyJet has backed IAG’s €1.4bn takeover attempt of Aer Lingus.

Carolyn McCall said that the deal would be “good for Ireland”.

Her endorsement of the attempted buyout comes less than a week after Virgin Atlantic told the Oireachtas Transport Committee that it was concerned about the intended acquisition.

***US delivery service FedEx has reached a deal to buy Dutch rival package delivery firm TNT Express for €4.4bn.

The companies “reached conditional agreement on a recommended all-cash public offer of €8 per ordinary TNT Express share,” a joint statement said. “The transaction represents an implied equity value for TNT Express of €4.4bn.”

The companies employ several hundred employees in Ireland between them. Spokesmen declined to say what effect, if any, the deal will have here.

Irish Times

***Global growth potential took a massive hit during the financial crash and is still likely to be slow over the next number of years, according to the International Monetary Fund.

A report from the organisation looking at international potential growth found that drops in private investment and employment cut annual growth in richer economies to 1.3pc  between 2008 and 2014.

This was half a percentage point lower than the level of growth seen before the financial crisis.

**Shares in budget airline Ryanair rose sharply yesterday on the back of the news that the carrier broke the 90m passenger barrier in its last financial year, which finished last week.

Ryanair carried 6.67 million passengers last month, 28pc more than it did in March last year. this brought its total number of passengers in the 2014-2015 financial year to 90.5m.

Analysts described the performance as “very strong” and shares in the carrier rose as much as 1.8pc yesterday, valuing the company at €15.3bn. Shares in the airline have gained over 50pc in the past year.

***The Luxembourg parent of a Dublin Kellogg’s subsidiary paid just €5,000 in tax on nearly €40m in profits in 2013, the Irish Times reports.

According to the paper, Kellogg Lux 1 Sarl is one of six subsidiaries that the US multinational food manufacturing firm has in Luxembourg. The company, which had no employees listed in 2013, received €40m from “financial fixed assets” worth €560m.

The paper adds that one of Kellogg’s Dublin subsidiaries, Kellogg Europe Trading Ltd had an after tax loss in 2013 even though it had a turnover of €1.4bn.

Irish Examiner

***Ensuring that large corporations pay a tax rate of at least 6pc would give the State funds to better meet the needs of services such as health, education and social housing according to Social Justice Ireland.

The independent think tank, which published its socio-economic review of the country yesterday, said an effective tax rate of 6pc for large corporates could potentially generate an extra €1bn a year.

The director of the organisation Fr Sean Healy said that the majority of SME’s were paying a tax rate of 12.5pc and were not availing of tax breaks which were frequently available for larger companies.

***Irish headquartered specialist healthcare firm Trinity Biotech has announced that it is raising almost $100m to fund potential acquisitions.

The company, which has its headquarters in Bray and is quoted on the US Nasdaq, is raising the money by issuing senior bond notes.

The notes have a 30 year maturity date and an annual interest rate of 4pc. The company expects the move to generate between $96m and $110m depending on the appetite for demand.

***The services sector here continues to grow but the rate of expansion is slowing, according to Investec’s latest Purchasing Managers’ Index.

Services in March rose at their slowest pace in 12 months but there was further growth in new orders and plans to take on more workers amid optimism that the economy will continue to improve.

The weak euro has made input prices higher but companies are selling more products overseas, according to the monthly survey of managers.

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