EXPLOSIVES FIRM CUTS STAFF AS RECESSION HITS HARD - Irish industrial explosives company Kemek Ltd has reduced its employee numbers by just under 43% this year as the recession continues to blow a hole in its profits, says the Irish Times. The company, which is half owned by Irish-listed building materials group CRH, has reduced the size of its workforce to 52. This is down from 91 last year, and a peak of 138 in mid-2008. The figures emerged yesterday as the company published its 2009 accounts which show that its profit after tax fell to €1.9 million from €10.9 million a year earlier. In 2007, the surplus was more than €17 million as it benefited from the boom in house-building and large infrastructure projects in Ireland. However, the company, which is led by John Higgins, has been significantly downsized in the past three years to reflect the sharp fall-off in activity in the Irish construction sector as the economy imploded. Sales declined to €25.2 million last year from €43.8 million in 2008 as the company felt the impact of the recession. "There was a very significant drop in sales demand in 2009 compared to the previous year," the directors' report stated. "Falling demand on a month by month basis resulted in sales revenues being down 43% for the full year compared to 2008," it said. In spite of this, the company paid a €2.88 million dividend to its shareholders in 2009. This brought to €29 million the amount it has paid in dividends over the past three years.
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AER LINGUS STARTS PRICING SMALLER CRAFT FOR ROUTE REJIG - Aer Lingus has initiated preliminary contact with Brazilian aircraft manufacturer Embraer and Canada's Bombardier to determine the pricing of smaller aircraft that the airline might consider using on European routes with demand levels that don't justify larger aircraft, writes the Irish Independent. An Aer Lingus spokesman confirmed contact had been made with the manufacturers, as well as existing supplier Airbus, to sound out pricing for smaller capacity aircraft than the airline currently has in its fleet. Chief executive Christoph Mueller is also believed to have told staff recently that Aer Lingus is considering the Embraer and Bombardier C series jets as an alternative to some of its existing Airbus aircraft. The Embraer E195 jet can carry 122 passengers, while the Bombardier C series typically carries 110 or 130. Both jets would have smaller capacity than the smallest Airbus aircraft currently in use by Aer Lingus, which is the A320. The airline has 30 of these short-haul aircraft, each configured to carry 174 economy-seat passengers. It also has six A321s on its books, each configured to carry 212 passengers.
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WARNING OVER MORTGAGE ARREARS - Homeowners are putting their properties at risk by prioritising personal debts, such as credit cards, ahead of mortgage arrears, warns one industry expert in the Irish Examiner. Debt Management Association of Ireland (DMAI) chief executive Eugene McDarby warned consumers against going into arrears during any mortgage restructuring. Those arrears will inevitably lead to extra charges. He said putting mortgage arrears on the back burner could see consumers plunge, unwittingly, into deeper debt. The warning comes at a time when consumers owe in excess of €180 billion and are now one of the most indebted populations in Europe, he said. "I am concerned, now that interest rates have jumped, that mortgage holders will opt now for interest-only mortgages, or consider a moratorium to alleviate the burden of their monthly mortgage repayment. The problem is that this is usually done for all the wrong reasons - ie to pay off other personal debts which are secondary. Mr McDarby said people are getting into mortgage arrears not only because their income has dropped but also because they are paying non-priority creditors ahead of their mortgage lender. He warned that this is dangerous and irresponsible but has come about, he said, because of the pressure tactics being used by unsecured creditors to get paid quickly.
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CHINA VOWS TO TREAT FOREIGN BUSINESS FAIRLY - Xi Jinping, the vice-president, reassured overseas companies that China will treat them fairly and is committed to becoming the world's most attractive destination for foreign investment, says the Financial Times. Lady Ashton, the European Union's foreign policy chief, raised worries about the difficulty of doing business in China during a meeting last Thursday with Wen Jiabao, the premier. It was the latest in a series of complaints by foreign politicians and executives that China is not opening up its market as promised when it joined the World Trade Organisation in 2001. Foreign businessmen were particularly angry at draft Chinese rules issued last year that would have required government entities to prioritise "indigenous innovation" in public procurement. Speaking at an investment forum in the south-eastern coastal city of Xiamen, Mr Xi affirmed that Beijing has revised the regulations and will treat foreign companies on the same basis as local ones.
