Business year in review: January to June

This is the business year in review from January to June.
Business year in review: January to June


2016 began with property, and the news that house prices outside of Dublin had soared in 2015, while the national housing supply stood at its lowest point in almost a decade.

Prices rose by an average of 8.5%, with a significant difference between Dublin, at 2.7%, and the rest of the country, where the average asking price jumped by 13.1%. The national average asking price in the final quarter of 2015 was €204,000, compared to €188,000 in 2014, and €164,000 at its lowest point in early 2013.

Prices rose by an average of 20.7% in Cork, by 19.7% in Galway, and 18.6% and in Waterford City. The most dramatic change came in Limerick City, where, a year previous, prices in the city were falling by 1.3% year-on-year, but in the last 12 months had risen by 22.3%.

Stock markets had a turbulent start to the year, with a flight from risky assets driven by concern about turmoil in China and escalating tension in the Middle East.

Even as the MSCI All-Country World Index’s bull market extended to more than 1,500 days, investors faced a 7% rout in Chinese equities, as the People’s Bank of China cut its yuan-fixing to the lowest since April 2011, reigniting concern about the outlook for the world’s second-biggest economy.

Cargo handling at the Port of Cork grew by nearly 1m tonnes in the year, bolstered by oil traffic, which rose 20% as the economy began to pick up and business returned to levels last seen before the economic crash.

The port handled 9.8m tonnes of cargo, up 10% on the previous year. Total container volumes through Tivoli and Ringaskiddy terminals grew 8% compared to 2014 figures with over 205,000 containers handled. The port’s cruise line business continued to expand, with 55 liner visits recorded in 2015, bringing ashore more than 145,000 passengers, whose spending power continues to be a major boost to the local economy.

The Dalata Hotel Group continued its expansion with a €40m acquisition of operatorship status in four hotels. The spend saw the company — which is the largest operator in the Irish hotel market, via its ownership of the Maldron and Clayton brands — add 1,171 rooms to its portfolio.

The purchase of the leasehold interests in Dublin’s Gibson Hotel, Limerick’s Clarion Hotel, the Croydon Park Hotel in London, and the Clarion Hotel in Cork also resulted in all four being rebranded as Clayton hotels. It brought to 18 the number of Clayton-branded hotels in Dalata’s portfolio, with a further €14m to be spent by the group on refurbishing the Cork, Limerick and Croydon properties.


Consumer confidence reached a 15-year high, according to the KBC Bank Ireland and ESRI consumer sentiment index, which showed an improvement in household finances outweighed concerns over jobs and the wider economy.

The index showed a reading of 108.6 points for January, up from 103.9 in December. While still reasonably positive, 49% of respondents said they anticipated a fall in the unemployment rate over the course of the next 12 months. Similarly, the percentage anticipating a worsening in employment levels went up from 16% to 21%. For the first time since 2006, slightly more consumers reported an improvement, rather than a deterioration, in their personal finances over the past year.

Irish SMEs have little or no knowledge of employment law and struggle to compete with multinationals for top quality employees, new research suggests. Up to eight in 10 small and medium-sized businesses have, at best, a basic knowledge of employment law — one of a multitude of factors that prevent smaller firms winning the talent battle with large multinationals.

However, the research pointed to an increasing level of optimism among SMEs, with three-quarters of the 560 surveyed more confident in their company’s ability to grow than they were a year earlier.

Concerns over Britain’s exit from the EU will weigh on UK financial markets for months to come, major bond market investor Pimco predicted ahead of the vote. The company, whose flagship fund alone manages €80.7bn in assets, said it saw a 40% chance of a Brexit vote at a referendum planned for later this year.

“We’re in a situation of profound uncertainty,” said Neil Mellor, a currency strategist at Bank of New York Mellon in London. “The big thing from a currency standpoint is that nobody knows what it will mean.”

Ireland is ideally positioned to supply sustainable food to the Middle East market, said Bord Bia Middle East manager Michael Hussey at Gulfood 2016, the world’s largest food and hospitality trade show, attended by 90,000 food buyers from 156 countries.

“While we export 90% of what we produce in Ireland, it is estimated that as much as 90% of food consumed in the Gulf region is imported.”

The Gulf region population, which currently stands at 43.5m people, a 56% increase in one decade, is continuing to grow, with forecasts suggesting it will exceed 50m people by 2020. Irish food and drink exports to the Middle East were valued at €385m, up by 40% since the €275m exported in 2012.


Technology has the potential to revolutionise Irish agriculture, according to Teagasc director Gerry Boyle.

“Information and digital technologies have transformed many sectors of our economy and our lives from transport, logistics and manufacturing to music and books,” Prof Boyle told the Teagasc ICT agri-seminar.

“The same potential exists in the agricultural sector.”

Digital technologies for sensing, analytics and automation are some of the key emerging technologies with the potential to revolutionise the future of Irish agriculture.

“Already some of that potential is being realised, but this is only a taster of what could be achieved in the future,” he said.

New housing starts have again disappointed with fewer than 1,800 units having been started in the last three months of the previous year, according to business group Property Industry Ireland.

Its property watch report found that 8,000 new homes were built in the whole of 2015 — well short of the annual average of 23,000 new homes that many experts say need to be built, if the supply of new units is to come anywhere close to meeting demand. The report confirms CSO figures which have in recent months showed that the rates of house price rises outside Dublin are outstripping those in the capital.

Cork-based multinational outsourcing company Voxpro more than trebled its US workforce after announcing 450 positions at its base in California. The company’s significant growth at its centre of excellence is part of its wider expansion plans ahead of a possible flotation, in 2019.

The global business outsourcing firm has scaled up rapidly in the past number of years thanks largely to a client list that includes some of the world’s leading technology companies such as Google, Airbnb and Stripe.

“North America is a very important part of Voxpro’s expansion strategy in 2016 and beyond,” said Voxpro chief executive Dan Kiely.

Dublin-based travel software firm Datalex continues to see China as a main avenue for growth, as tourism demand increases among the country’s middle class. The company, which provides e-commerce and retail software to many of the world’s leading airlines and travel firms, has been targeting the Chinese market over recent years with an office in Beijing and Air China as a key customer.


A technology conference said it aims to attract 10,000 attendees to Dublin and reaffirm the capital as the “epicentre” of the global tech scene after the departure of the Web Summit to Lisbon. The Dublin Tech Summit, will be held in the Convention Centre and the Silicon Docks area in February.

The conference’s location, nestled among many of the world’s largest multinationals in Dublin’s thriving docklands, will aim to foster links between large established firms and indigenous SMEs. A number of speakers have been confirmed, including Uber’s lead engineer, Rafi Krikorian, and Irishwoman, Jules Coleman, co-founder of London-based startup, Hassle.

A huge annual surge of over €4.7bn in household savings reveals the challenge facing young buyers because of the year-old Central Bank mortgage lending rules, an estate agency has claimed. CSO figures showing that gross savings leaped last year to over €9.1bn from €4.4bn in 2014, show the mortgage lending rules are helping push first-time buyers and their parents “to save harder for housing deposits”, said Savills Ireland research director John McCartney.

“Since the start of 2015, new mortgage rules mean that home buyers can borrow less,” said Mr McCartney. “Therefore, they have to save bigger deposits. In this context, it is not surprising to see a rise in household savings.”

Estate agents, mortgage brokers and other home-selling industry groups criticised the Central Bank rules since their introduction in February 2015. The rules have placed ceilings on the amount first and second-time buyers can borrow to buy a home, based on affordability and other sustainability factors.

Irish imports of UK goods and services is set to surge from existing record highs to €66bn in the coming decade. The value of imports from the UK will grow by 66% in the next 10 years, adding a further €26bn to the overall level of imports which currently stands at a record-high of €40bn.

Ireland will remain the UK’s fifth largest trading partner and biggest per capita, according to the findings of Barclays Trade Forecast. Barclays Bank Ireland head of client coverage Helen Kelly, said that Ireland will remain a critical trading partner of increasing significance over the coming years.

“Each week, over €1bn of trade is conducted between Ireland and the UK, highlighting the huge economic significance of the two markets to each other,” said Ms Kelly

The next five years is a make or break period for Ireland’s burgeoning offshore exploration sector, an industry analyst said. A report on the sector by Davy Stockbrokers indicated that development of the Celtic Sea and Atlantic Margin areas will ultimately show if the industry has a viable future.

“Notwithstanding the presence of four discovered gas fields, the single biggest factor offshore Ireland is that no oil field has produced, or is producing, oil,” said the report. “It is difficult not to conclude that the next five years, or so, will determine the outcome of the Irish offshore.”

Elsewhere, there was good news for Irish mining and exploration firms focused overseas. Tullow Oil shares hit a nine-month high after the company, which has debts of $4.5bn, agreed extended borrowing facilities with its lenders. Mining firm Kenmare Resources announced plans to raise €242m in funding to be largely used to dent its debt.


Warren Buffett spread in an even wider arc around the globe this year, as the iconic Berkshire-Hathaway annual general meeting streamed live on the internet for the first time. The legendary ‘Sage of Omaha’ organised the webcast through Yahoo Finance “to reach more people than ever in key financial centres and to bring the energy and excitement of what happens in Omaha to an informed audience around the world”.

Berkshire’s investments are spread across a vast empire of energy, insurance, manufacturing, transportation and retailing, through 90 companies with a market value of over €350bn.

Up to 1996, the crowds at the AGM measured less than 10,000 — a situation that transformed when the company issued its lower-priced, second tier B share, currently costing $147.60, on the New York Stock Exchange. The A share, backbone of many an investment house portfolio, at the time traded at $221,430. Both shares were up on the year.

Vodafone Ireland attributed a near 2% rise in revenue in the year to improvements in its mobile and fixed-line business, despite a significant number of mobile customers leaving the network over the final quarter. Its total service revenue increased to €953.7m for the 2015-2016 financial year, representing an €18m rise on the previous year. Its fixed-line business revenue grew particularly strongly, with a 12.3% rise to €214.7m, while its fixed customer base increased by 17,400 to 239,000.

Vodafone said data usage on its mobile network increased by more than 70% in the year. The company’s Irish operations hemorrhaged mobile customers in the final quarter of the year, however, with 47,000 fewer people using its services at the end of March than just three months previously.

Ryanair said it expected to announce an extension to its share buyback programme which will have returned €800m to investors when scheduled to run its course in September. The airline returned more than €1.1bn to shareholders in its last financial year via stock buybacks and the passing on of the near €400m from the sale of its Aer Lingus stake.

Merrion Capital at the time cut its earnings forecast for Ryanair’s current financial year, which runs to the end of March, by 5%, mainly due to the effect of cancelled flights on the back of continued air traffic control staff strikes across Europe. However, the brokers at the time still saw the airline’s share price rising by nearly 30%.

Amazon’s European expansion gathered steam with the announcement that it was to add a further 500 employees to its Irish workforce. Such has been its experience in Ireland, where it already employs 2,200 staff, Amazon has surpassed even its own expectations of growth, according to the company’s general manager in Ireland, Jeff Caselden.

“We have already exceeded our previous talent growth targets for Ireland set in 2014, which is testament to the abundance of expertise we have been able to find in the country,” he said.

Since 2010, Amazon has invested over €15bn in Europe and at the start of 2016 had more than 40,000 EU employees, with 10,000 jobs created last year alone.


Finance Minister Michael Noonan and the National Asset Management Agency (Nama) strongly endorsed the auction process behind the sale of the so-called Project Eagle loans.

The auction by Nama of a large bundle of distressed loans secured on properties in the North and Scotland completed in April 2014 was thrust back into the spotlight that month following two arrests in Co Down amid an investigation by the UK’s National Crime Agency.

A BBC Spotlight programme reported on new revelations involving the controversy in February, with the Stormont finance committee holding hearings on the controversy. Parties to the deal have repeatedly denied any wrongdoing.

Nama chairman Frank Daly said there was competitive tension in the process conducted by Nama in selling the Project Eagle loans. US equity fund Cerberus won the auction after investment giant Pimco had pulled out, or was excluded by Nama, from the process around the middle of March 2014. Another New York-based-fund, Fortress, was the runner-up.

Ireland has signed up to an international pact to foster cross-border co-operation in the development of an offshore renewable energy sector in northern Europe — joining Britain, France, Germany, the Netherlands, Belgium, Sweden, Denmark, Norway, and Luxembourg in the initiative.

The aim is to grow the use of renewable energy in northern Europe and boost affordable energy supply from offshore outlets, particularly wind farms. It should also prompt more multi-country cooperation and reduce the cost of wind turbines. The EU sees offshore renewables as key to the achievement of its goals of reducing gas emissions by up to 95% by 2050, compared with 1990 levels.

Ireland is likely to fall short of its target of 16% of its total energy needs from renewable sources by 2020, and will face a challenge to meet its 2030 target of 27%, if the Government doesn’t put in place a definitive policy around renewable energy, according to the National Offshore Wind Energy Association.

The value of the State’s investment in Irish banks fell by over €3.3bn in just six months as a torrid start to 2016 rocked bank shares across Europe. At the end of last year, the estimated remaining value of the State’s investment in AIB, Bank of Ireland, and Permanent TSB — including money already recouped through disposals and fees — stood at €29.3bn.

This was €300m more than taxpayers originally pumped into the three banks. European bank shares, and those of the Irish banks, in particular, have been hit hard by a global stock market slide since the start of the year. At the time, the State’s net position was worse off than in December. Having previously pledged to begin selling down the State’s holding in AIB immediately after the general election, an initial sale has now been pushed back, as the Government awaits an improvement in stock market conditions.

Irish taxpayers were among the biggest losers in the fallout as the UK voted on June 23 to quit the EU after a member of more than four decades. Sterling slumped against the dollar and the euro; global markets on the day were upended; and more than €260m was wiped from the value of the State’s shareholding in Irish banks.

Shares in Bank of Ireland and Permanent TSB slumped badly from early morning to finish sharply lower on the day. The Iseq fell 7.7% on the day after recovering from even a heavier slump.

Sterling slid by the most on record against the dollar, reaching its weakest level since 1985. Its plunge against the dollar on the day was its worst day on record, exceeding the drop on 1992’s Black Wednesday, when sterling was forced out of Europe’s exchange-rate mechanism.

More in this section

Lunchtime News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up

Our Covid-free newsletter brings together some of the best bits from, as chosen by our editor, direct to your inbox every Monday.

Sign up