M&S ACTIVITY TUMBLES AMID BREXIT AND TRADE WAR - The number of Ireland-linked mergers and acquisitions (M&A) so far in the third quarter has tumbled by a third compared to the corresponding quarter of 2018, with Brexit likely taking its toll on activity.
The value of deals with an Irish link has slumped by almost 38% in the period, to €5.3 billion. The data covers any deal that includes an Ireland-registered company. Figures prepared for the Irish Independent by Refinitiv show that there have been 84 Irish-linked M&A deals so far in the third quarter, which ends this month. The quarter is on course to deliver the lowest number of quarterly Ireland-linked M&A deals since 2016. In the first quarter of this year, there were 101 Ireland-linked M&A deals completed, with a total value of €2.6 billion. In the second quarter, the figures rose to 121 and €16.4 billion respectively. Among the biggest M&A deals reported so far this year with an Irish link is the planned €7.7 billion takeover by Ireland-headquartered diversified manufacturer Ingersoll Rand of US machinery maker Gardner Denver. Other big pending deals this year include CRH's €1.64 billion sale of its European distribution arm to investment giant Blackstone. The data from Refinitiv shows that KPMG, PwC, Deloitte and Goldman Sachs remain the joint top financial advisors on Ireland-linked deals this year. Each are involved in eight transactions.
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'NOT SUSTAINABLE' TO KEEP 750,000 PEOPLE OUTSIDE TAX NET, INSTITUTE WARNS - It is "unsustainable" to keep more than 750,000 income earners outside of the tax loop, the Irish Tax Institute (ITI) has warned.
In a pre-budget submission, the institute said that more than a quarter of the State's 2.7 million income earners were exempt from paying any tax, which left the tax base extremely exposed at a time of growing uncertainty with Brexit and a potential global downturn, says the Irish Times. "We believe that everybody who works should contribute to the exchequer according to their means and that those who earn most should contribute most," ITI president Frank Mitchell said. "A system that exempts more than three-quarters of a million out of a total 2.7 million income earners from paying any tax is not sustainable," he said. "We need a broader base where the load is spread according to the means of taxpayers," he added. The institute said that a person earning €75,000 currently pays a multiple of eight times more personal tax - income tax, universal social charge (USC) and social insurance - than someone earning €25,000, while a person earning €100,000 pays 12 times more than someone on €25,000. The ITI said USC, the broadest component of the tax base, has been gradually eroded over the last four years. It accounted for 23% of the income tax take in 2015 but only 18% last year. And the number of taxpayers exempted from paying it has risen from 12% when it was first introduced in 2011 to 28% in 2019.
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UK CREDIT CARD SPENDING OVERTAKES CASH FOR FIRST TIME - Credit card spending has overtaken cash for the first time, according to data from UK retailers. This means notes and coins have been demoted to the third most popular method of payment.
The figures from the British Retail Consortium (BRC) - whose members are responsible for £180 billion of sales - come amid warnings that millions of adults would struggle to cope in a cashless society. In its latest payments survey, the BRC said debit cards remained the most popular payment method and that they overtook cash in 2018. Total plastic card spending accounts for almost 80% of retail sales, reports the Guardian. "For the first time, credit card spending has outstripped cash spending," said the BRC. Total UK retail sales rose by 4% to £381 billion in 2018, with debit card payments representing almost 57%. Meanwhile, credit and charge cards accounted for 21.5% of the total, a percentage that has remained constant over the past few years. The cash share of the total fell to 20.4%, or just over £77 billion, down from 22% in 2017 and almost 28% in 2013. The BRC said despite the findings, cash remains an important part of retail, particularly for many vulnerable people. It said it was working to ensure the long-term viability of ATMs and reduce barriers that prevented many businesses from offering cashback to customers.
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SMYTHS TOYS TO EXPAND FURTHER AS UK REVENUES HIT RECORD LEVELS - Sales of Lego and superhero toys last year helped family-owned Irish toy-seller, Smyths to record revenues of over €656m in its expanding UK operation.
New figures show that the Galway-headquartered business enjoyed strong growth in 2018 in the UK as sales surged by 22% from £475.7m to a record £581.57m (€656.1m). Pre-tax profits at Smyths Toys UK Ltd increased by 22% from £11.88m to £14.5m. Smyths is planning to expand its UK store network on the back of the strong performance. The company only entered the UK market in 2007 and its business has grown exponentially there since then and it last year opened a further six outlets, says the Irish Examiner. Smyths currently operates 100 stores in England, Scotland and Wales and on the UK performance in 2018 the directors said they "are very pleased with the increase in profit particularly given the current economic climate and the competitive market place". They said that sales "were driven by growth in both existing UK stores and also the six new stores opened during the year". The six new stores followed the opening of 12 new stores in 2017.
