The Business Observer Newspaper - 7th May

INTERVIEW

Issue 25

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May 7, 2015

Distributed with Times of Malta

Enemalta chairman Fredrick Azzopardi has had to deal with fundamental changes to the utility company’s finances, operations and strategy. He said the future was looking positive. see pages 10 and 11 >

NEWS Go has reviewed its €50 million property portfolio and decided what it needs for its operations – leaving Spencer Hill and Birkirkara free for development into business centres. see page 3 >

15.5% between asking and selling prices for property Vanessa Macdonald The gap between the asking price for property and the eventual selling price was 15.5 per cent in 2014, slightly lower than the gap of 16.21 per cent in 2013, according to the records of one of the leading real estate companies in Malta, Re/Max. Another interesting figure to emerge from the study was that the gap in 2012 was 23 per cent.

The figures only relate to one agency – albeit one with three times the presence of its closest competitor. Gozo was not included as the numbers were smaller and might therefore not be statistically significant. And they do not reflect properties sold directly or through a sensara

(broker), which account for almost 60 per cent of property listings.

Nevertheless, the trends are very interesting, particularly when crossreferenced against the length of time that the property took to sell.

Jeff Buttigieg, the regional director for Re/Max, said that properties listed with multiple agencies were up for sale at the original price for 521 days on average. Once the asking price was dropped, they remained on the market for another 133 days, a total of 654 days. In 2013, the total number of days was almost unchanged at 653.

“Once a property gets within seven to 10 per cent of its real value, then it sells much faster, within a little more than four months,” he said.

“This means that no one will even consider a property until it falls into the right price category.”

Even more dramatic was that a property with an exclusive real estate agent sold within 32 days (2013: 65 days).

Re/Max also noted considerable differences between locations, with Sliema seeing the narrowest gap – 11.81 per cent – and the highest in central Malta – 19.3 per cent.

Re/Max also compared the average selling price of all the properties it had sold with the average asking price of all the properties listed, not just those that had been sold, and the gap was 35 per cent.

“This explains why so many properties remain on the market for a much longer period than they should,” he said.

The figures also put into context reports by the Central Bank of Malta based on advertised prices

which stakeholders have often said did not capture the full picture – because the actual selling price was lower. For 2014, the CBM reported a rise of seven per cent, accelerating from a growth rate of 2.1 per cent in the previous year.

Eurostat, the EU statistical agency, reported that prices rose by 11 per cent in the fourth quarter of 2014, compared to the same period a year earlier, significantly higher than the EU average of 2.6 per cent and the euro area average of 1.1 per cent.

The Re/Max study could not identify the rise in property prices as the mix of properties sold was affected by the increase in smaller properties for first-time buyers, spurred by special terms to boost this sector.

INDUSTRY FOCUS e property and construction sectors are no longer overheated but with stability comes the time to take a step back and see what is happening. see pages 8 and 9 >

STOCK MARKET REVIEW Analyst Edward Rizzo admits that Bank of Valletta’s interim results were impressive but asks whether it should have notified the market sooner about a legal battle it is facing. see page 18 and 19 >

e Business OBSERVER

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May 7, 2015

NEWS

Go planning two business centres Go is planning to turn its former HQ Spencer House in Marsa and its premises in Birkirkara into business centres to be leased as premium office space to third parties.

CEO Yiannos Michaelides said that the telecoms operator had finally made key decisions on what to do with its €50 million property portfolio – which first necessitated a thorough review of its operational requirements.

It is now at an advanced stage of the Mepa permit application process for Birkirkara and Marsa, and has also decided to move its exchanges in both Sliema and St Paul’s Bay to new, considerably smaller premises next year, freeing up the existing exchanges for other options.

The properties had been transferred to a special purpose vehicle called Malta Properties, which is being kept as a separate and independent business entity.

“Once all the permits are in hand, we will be able to start calculating the rents or income that these properties can generate,” he said.

Its Żejtun site had originally been on the list for possible alternative use but Go has decided to retain it as a core part of Go operations, turning it into a technical hub.

Mr Michaelides said that the company’s diversification

“If you make a prudent, small and manageable investment, then it can prove to be worthwhile”

strategy was working, noting that the average Ebitda margin for a number of operators in the last quarter of 2014 was 28.8 per cent while Go’s was 40 per cent.

Diversification has not always been a success: its multimillion euro investment in Forthnet had to be completely written off, although shareholders might see some of that money come back as both Vodafone Greece and Wind are interested in buying it.

“There was a story in Greek newspapers last week that Vodafone is still interested in buying it.

The two bidders have already made non-binding bids. They then completed a due diligence process and it is now up to them whether to make a binding bid. It is only at that stage that the board would decide whether to sell and whether the bid is a fair value.

“We are waiting – there is no deadline. All that is happening in Greece at the moment is overshadowing this...” he admitted.

He is confident that Go’s investment in Cypriot Cablenet, which has 47,000 subscribers, is completely different.

“Irrespective of what happened in the past, if you make a prudent, small and manageable investment, then it can prove to be worthwhile. Cablenet was an investment that the Go balance sheet could take comfortably.

The company has a double digit growth story and its performance is meeting expectations. The Cypriot economy was at the bottom when we made the investment but it has been improving steadily and 18 months later we can say with confidence that our choice was correct.

“Eventually it could surpass Go. We have the option to take a majority shareholding and consolidate the numbers. We will make the decision at the right time. It could generate important revenue for Go.” Go recently reported a profit before tax for 2014 of €20.3 million, up 30 per cent over 2013.

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e Business OBSERVER

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May 7, 2015

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NEWS

88% of payments still in cash

The Maltese are still very fond of cash, and use it for 88 per cent of their payments, with credit cards and debit cards only taking up 4.0 per cent each – although cash tended to be used for lower value payments.

The Maltese keep between €20 and €50 in cash for daily purposes, with only 1.8 per cent reporting that they do not carry any cash around with them at all.

SOURCE: WORLD PAYMENTS REPORT

A survey by the Central Bank of Malta calculated that based on the amount of cash held and the amount of transactions, around €15 million of transactions every day were being made in cash.

Cash was even the preferred method of payment for consumer goods like white goods, cars, electronics and furniture: 62 per cent paid in cash, with debit cards next (13.6 per cent) then credit cards (9.7

per cent), cheques (5.3 per cent) and internet banking (4.5 per cent).

The CBM survey also found that while cash was used for 88 per cent of transactions, it accounted for 54 per cent of the overall amount. For higher value transactions, internet banking was a clear favourite. At 17 per cent, it ranked second as a percentage of total transactions in terms of value, but only 1.3 per cent of the volume.

Cheques accounting for less than 2.0 per cent of the volume of transactions but 12 per cent of the value. The mean value of cheque payments was €81.

The payment method that seems to be making least headway is direct debits, which only accounts for 7.0 per cent of the value of transactions.

The CBM also asked respondents how they saw their preferences for payment methods to change over the coming five years, with internet banking having the greatest prospect for growth.

Around a quarter of respondents said they would use more, although almost as many also said they would use more debit and credit cards.

Yet again, direct debits do not seem to be making inroads, with minimal interest expressed even in the coming five years.

The CBM and other stakeholders have been trying to move people away from traditional payment methods – particularly cheques with their high costs for banks – to more innovative and efficient ones.

Cheque usage is declining around the world, and contracted by 9.6 per cent in 2012 to reach 28.1 billion transactions. Europe has seen even greater declines over the years, and in 2012, only 4.8 per cent of non-cash transactions were by cheque (compared with 8 per cent

in 2008), although it remains a popular payment method in the US, which account for almost twothirds of the world’s transactions.

According to the World Payments Report, global debit card transactions grew by 13.4 per cent in 2012, compared to a year earlier, while credit card use rose by 9.9 per cent.

Debit and credit cards accounted for 60.9 per cent of all non-cash transactions.

The European Central Bank had figures for 2013 for the EU alone, with card payments accounting for 44 per cent of all transactions, and cheque use declining steadily.

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e Business OBSERVER

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May 7, 2015

NEWS

UK enquiries rise after pension changes

Companies offering pension services to British expats have seen a large number of enquiries about Malta pensions in recent weeks from expats based overseas.

The enquiries have picked up after the UK made changes to pensions last month, which allow people to withdraw a lump sum rather than an annuity.

Until now, only a percentage of the sum could be withdrawn, but the changes mean pensioners will find themselves with a considerable amount of money to use or invest. Operators in the financial services sector are clearly eyeing those funds and hoping to draw them to their respective jurisdictions – and Malta may have an advantage that has not been fully appreciated.

It has been announced that the new UK pension freedoms will be restricted to UK pensions retained in EU countries. This is important because all the main so-called QROPs – Qualifying Recognised Overseas Pension Scheme – jurisdictions are outside of the EU... apart from Malta.

“Malta’s Retirement Pensions Act was brought in on January 1, 2015. The new pensions framework has given Malta QROPs a notable advantage in that it allows providers to pay retirement benefits that mirror the new UK flexible pensions regime,” Ravi Viroomal, from Sovereign Trust (Malta) Ltd, explained.

“The QROPs benefits are available in flexible form from age 55 and there will be no need to annuitise. For the time being Malta remains ahead of the curve, as non-EU based QROPs jurisdictions remain subject to a more restrictive framework at the present time. Furthermore, the act introduces the option for a member to self-manage their Malta-based QROPs, raises the latest retirement age to 75 and allows the pension fund to borrow towards the acquisition of commercial property. The pragmatic new framework, combined with a strong schedule of tax treaties, is sure to prove a further boost to the island’s economy.”

Michael Lavin, an independent financial adviser with Hollingsworth International Financial Services Ltd, said the changes could mean a windfall for Malta: “This gives Malta a huge unexpected advantage over her competitors in this space and is likely to result in large volumes of pensions money coming into the island from Brits living all over the world.”

“Retaining the option to at least withdraw additional lump sums could be invaluable as a source of energy funds”

The CEO of Momentum, Stewart Davies, explained he was also convinced that Malta will be at the forefront of the international retirements benefits market, in particular as it relates to the UK expatriate.

“Its position within the EU allows it to follow more closely UK legislation, reflected in its decision to mirror QROPs rules in the new Retirement Pensions Act. This includes the ability to flexibly access retirement funds,” he said.

“Competitively, these factors should allow it to stay ahead of other jurisdictions such as Gibraltar, Guernsey, New Zealand etcetera, which sit outside the EU in terms of their recognition under the QROPs rules.

“This therefore should lead to an expansion in the number of retirement benefits scheme administrators in Malta, which based on market intelligence already receives over 50 per cent of the International QROPs business.”

Mr Lavin added: “As the only QROPs jurisdiction to allow this flexibility, I believe expats around the world are now looking at

Malta as the first port of call for UK expat pensions.”

He said it was a shame, however, that the benefits of Malta pensions were better known overseas.

“A greater awareness among the expats actually already living here could only be beneficial,” he said.

The default advice has always been to exercise caution before withdrawing the full amount but Mr Lavin said that being able to draw out money gave people much more freedom.

“While for most people drawing out their pension in excess of the old government caps is likely to leave them short in later years and doesn’t represent sensible planning, retaining the option to at least withdraw additional lump sums could be invaluable as a source of ‘emergency funds’.

For example pensioners can face significant long-term care costs in the event of ill health and the option to draw an additional lump sum from their pension in these circumstances could make a real difference,” he said.

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e Business OBSERVER

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May 7, 2015

INDUSTRY FOCUS

PENDER GARDENS IS A NEW DEVELOPMENT IN THE HEART OF ST JULIAN’S. IT PROVIDES LUXURY REAL ESTATE AND APARTMENTS.

Better procurement rules would mean better standards The boom just before EU accession seems to have turned everyone into a developer – including a lot of cowboys.

But some of the leading players in the sector believe that the situation has now settled down and that property and construc-

tion, currently 3.4 per cent of GDP by value added in 2014, will continue to be one of the most important sectors of the Maltese economy in the coming years.

Ballut Blocks’ managing director Paul Vella, who has 48 years’ experience in the

construction industry, said that as Malta evolves, the country would increasingly require sustainable projects, both in terms of public procurement as well as private projects.

“These will drive the economy to grow further and generate a

better standard of living for all. There are opportunities to improve the sustainability of future buildings housing Malta’s new industrial and economical clusters by adopting innovative and green practices.

He is optimistic that stakeholders can – and will – improve the sector, some of which has unfortunately generated considerable bad press over the years.

“Maltese professionals operating within the building and construction industry in Malta –

e Business OBSERVER

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INDUSTRY FOCUS

including entrepreneurs, architects, engineers, designers, urban planners and policymakers – need to work closer together to seek environmental sustainability in terms of design, materials and regulation, as in this way they will also be ensuring the long-term future of a stable construction industry in Malta. This cannot be emphasised enough considering Malta’s small and densely populated island,” he said.

“Undoubtedly, the industry will be increasingly challenged to make sensible use of land and natural resources, while reducing both indoor and outdoor pollution, during construction phase and during the buildings’ usages.

“On the positive side, the construction industry professionals are growing increasingly aware of the responsibilities in planning, designing and constructing buildings that can fulfil the needs of future generations and offer them the right environments where they can achieve their aspirations.

“It is up to serious, responsible and professional companies in the construction industry, irrespective of whether they are big, medium-sized or small, to lead the way through construction projects that are architecturally suitable for Malta, while sustaining its economic and financial growth,” Mr Vella said.

One of the areas that generates most complaints is roadworks. At the moment, there are more than 300 roadworks under way across Malta. This represents an increase of more than 50 per cent on the 200 roadworks that were causing congestion six months ago.

Chris Refalo, the project manager of V&C Contractors Ltd, is well aware that the very mention of roadworks makes people roll their eyes – for both the inconvenience they cause as well as for the sometimes shoddy workmanship.

“Construction activities are innately burdensome. Simply

doing an alteration in one’s home will affect the people who live there. When you escalate the users exponentially – say road users who are becoming increasingly impatient because of the extensive works – any intervention in the road network is bound to create news,” he said.

“Additionally, in contrast with construction works in private dwellings, roadworks are extensively visible. Thus, issues which in other industries might pass unnoticed will inevitably be a top priority in everyone’s debate agenda.”

Mr Refalo said that the situation was, of course, complex and that the problems accumulated from various other factors.

However, he blamed poor workmanship squarely on the fact that the procurement methods used by the government put contractors in a position where they must cut costs to win tenders.

“The problem relies within the fact that work is awarded to the ‘cheapest compliant bidders’ without any weighting whatsoever to the abilities of potential contractors.

“If at evaluation stage the technical ability, experience and track record were given the same importance as price, clients would get value for money in both the short and long term. This will instigate a natural selection which will either push out incompetent contractors – or force them to improve,” he said.

The property sector has also changed dramatically with the peak of nearly 12,000 applications a few years ago, dropping to a few thousand.

The amount of new properties may have been declining but this has been offset by the tremendous increase in rental properties, boosting the ‘buy-tosell’ sector.

“Last year we saw an increase of 20 per cent in rental investments and this trend continued throughout the first quarter of 2015,” Re/Max director Jeff Buttigieg said.

“Purchasers also look for well-run developments that are maintained and kept up to standard, safeguarding their investment”

“This higher demand is due to a number of reasons, one of which is that industries with foreign expatriates are expanding, ad hoc major projects that require foreigners – such as the Delimara project – which are coming to fruition, and the increase in demand for short-term holiday homes. This demand has attracted homeowners of properties that previously were available for long term to shift to accommodate short-term lets for a better return.”

The increase in supply has been met from both new builds and refurbished properties being put up for rent.

Mr Buttigieg said the refurbished properties were very often homes that did match the present trends – either because they were furnished with old outdated furniture, or did not have the standard amenities such as air conditioning and LCD TV. He was optimistic that the increase would continue throughout 2015 – and that the demand would spread wider.

“We don’t feel that there is any major shortfall of properties; it is just that most expatriates prefer to live in the Sliema and St Julian’s area. However, they are now choosing to expand their search and are most definitely finding a home,” he reassured.

Another trend kicked off within the past decade or so was the preference for complexes.

Michael De Maria, the sales and marketing manager for Pender Gardens is not in the least bit surprise by the shift.

“One of the main reasons for this trend is the availability of everything you need on-site or very close by. Our slogan ‘everything surrounds you’ is just that.

“And it is not only about the amenities on site – for retail, to leisure and parking – and the surroundings.

“Purchasers also look for well-run developments that are maintained and kept up to standard, safeguarding their investment.”

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e Business OBSERVER

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May 7, 2015

INTERVIEW

Power to the people

FREDRICK AZZOPARDI

Enemalta chairman FREDRICK AZZOPARDI was appointed CEO and then chairman in 2014, and since then has had to deal with fundamental changes to the utility company’s finances, operations and strategy. He dissociated himself from the past but told VANESSA MACDONALD the future was looking positive.

Enemalta’s last annual report was for 2011. Are you being fined by the Registrar of Companies?

As far as we know, no, we are not being fined. We were set up in August 2013 as a public limited company and we will be submitting our reports according to the schedule set out by the MFSA. So will the missing corporation ones not be issued?

The corporation no longer exists.

The 2014 forecast was for Enemalta plc to make €19.5 million loss after tax, according to the financial estimates laid in Parliament last June.

Moody’s said there would be a loss of €17 million – excluding the sale of assets to private partners, and a €5 million profit by 2015. What actually happened?

Following the introduction of several measures to streamline its operations, reduce administrative costs and restrain non-technical losses, unaudited accounts for 2014 indicate that losses after tax are substantially less than forecast figures.

The company’s plans for the next

three years target further loss reductions in the coming years.

The Energy Minister gave 2017 as a deadline by when Enemalta must be profitable. This is being done in different ways, through the generation of electricity and reduction in losses of theft but also through the sale of non-strategic assets, which Moody’s think could amount to €75 million.

Our starting point was to reduce generation costs. There were also numerous initiatives linked to generation, including replacement of the less efficient plants, such as Marsa Power Station, which has now been decommissioned. We are now also using the interconnector to Sicily and Delimara will switch to gas. This will drastically reduce generation costs to the minimum possible and will mean considerable savings.

However, this will take a few years. So we had to take other initiatives, including the reduction of non-technical losses – mostly theft – which we have been doing assiduously since the beginning of 2014.

By the end of the year, theft was

down by 33 per cent, resulting in savings of millions. Distribution losses were also cut.

There was also an improvement in billing. We found bills that had not even been issued, especially for temporary connections. The systems have been updated and we – Enemalta and ARMS – improved our billing. This resulted in additional income.

Taken together these represent millions in savings for Enemalta.

Can you be in the black by 2017?

Yes, according to our targets.

How much was owed by customers for electricity? How much has been collected?

Arrears for electricity at the beginning of 2014 were in the region of €140 million. In one year and three months, the figure was down by €20 million. And debtors and debtor days are being reduced.

How many employees were there when it was Enemalta Corporation and how many are there now?

Including the petroleum division – which has since been hived off as a separate government company – there were approximately 1,500 in all. Today, we are under 1,000.

Marsa Power Station is now on ‘standby’ so clearly a number of employees were no longer needed there. But we need more people on distribution: the average age of those working there is high, and many are close to retirement. We are retraining 20-30 workers who volunteered to move but there will be others.

Anything to do with human resources is being done in collaboration with the four unions representing Enemalta employees.

Until now, we have managed to find the best solutions, and I am convinced that we will continue to do so, working out the optimum number of employees in each sector. It is not easy to reduce the headcount but I am convinced that we will reach that number.

The government has been heavily criticised for 11 contracts transferring land to Enemalta. One of the

parcels of land was the Marsa Power Station, which belonged to Enemalta but was transferred to a special purpose vehicle (SPV), Vault Finances, in 2012 by the Nationalist government. Why? In 2012, repayments were due on three “bullet” loans and it was decided to refinance the loans through this SPV, resulting in one 25-year loan. Had the bullet loans not been paid, there would have been serious repercussions, such as a call-in by one of the banks, which would have been a catastrophe not only for Enemalta but also for the country.

Enemalta, which had debts of over €800 million, could not have obtained the 25-year loan. With the property as collateral, the SPV could.

There was an option for Enemalta to take back this property at any time.

It seems to have taken back this land at a very opportunistic time as it became part of the asset that Shanghai Electric Power ended up with.

I can assure you that it was absolutely not a part of the deal. It was

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INTERVIEW

only part of the Enemalta restructuring. When the agreement was signed in 2012, Shanghai was not even in the picture. It could never have been envisaged that it would be transferred to Shanghai or to any other entity, for that matter.

Apart from Marsa, there was also 310,00 sq.m. of land to be used for photovoltaics. This will compete with the private sector, which is desperate for land for solar farms...

It is not land, it is air space. And most of it is wasteland – much of it at Magħtab. It is not enough to quote the area as not all of it can be used for PVs. At Magħtab, for example, you cannot have PVs on the north-facing part.

The private sector was interested in wasteland as that is the only place solar farms are allowed...

The government’s excuse was that this was a rental agreement and not a lease – which explained nothing!

We are also partly private with our own business plans. This is part of our own diversification, aimed at being financially sustainable.

Our shareholders – the government and Shanghai – will not want to cover losses. So we need to think outside the box unless we want Enemalta to close down, the repercussions of which would be unthinkable.

Moody’s once estimated that smart meters would increase Enemalta’s cash flow by €5 million a month – €140 million overall.

Are they making a difference to billing and revenue?

They are making a difference but installing a smart meter does not necessarily mean you are billing more. It also depends on whether it is ‘reachable’ – able to be read remotely in real time through the power lines.

This is what would allow us to increase the frequency of billing.

Although we installed and commissioned the Enel meters, we encountered problems with regard to the reachability of some of the meters because we are densely populated, which was affecting the background ‘noise’ on the lines.

This was the first time Enel had encountered such problems. So we are now making another push to increase the amount that are reachable and we are seeing success.

That was solved as we and Enel were able to develop monitoring software – which would also identify different attempts to tamper with them – and a new type of meter has been designed which cannot be opened.

With the three-phase meters, which were supposed to have this device, the 7,000 meters we had in our stores were sent back for the devices to be retrofitted.

These smart meters were part of a €75 million contract with IBM, which had been the sole bidder. Is IBM in default of its contractual obligations to provide integrated billing?

I prefer not to go into the contract details. However, I can say that not all the meters are reachable. But we, IBM and Enel are trying to improve this.

So what about the three-phase ones that were already installed?

We took a number of initiatives, short-term, medium-term and long-term. We have installed safeguards to detect tampering on all the three-phase meters.

And the ones that were already installed are also being monitored.

Measures are also being taken to ensure that there is no tampering.

In 2010, IBM boasted in a presentation that its system would eradicate theft and fraud. Peter Grima, a former Enemalta chief officer, said that there should have been a device which tripped automatically if anyone tried to tamper with the meter. But it turned out that these devices were never built in.

Did someone instruct IBM to leave them out? Was this part of a huge scam? Are the police investigating?

If there was something illicit done by someone instructing IBM to leave out these devices, I do not know about it. What I am sure of, however, is that the meters did not trip but we and Enel developed a new meter which does trip. These are being installed...

Who is paying for all this extra work and equipment? Taxpayers?

Was IBM contractually obliged to provide these devices or not?

That is being handled internally and it would not be prudent to say at this stage. We did everything we could at the beginning of 2014 when I and my management team started. And we continue to do whatever is needed to prevent tampering – either by methods we have already identified, or by new ones – through analytical software.

So you installed nearly 240,000 meters which are not tamperproof and you are now going to have to replace them? Again, is IBM in default of its contractual obligations? If so, is it going to get away with it?

We found out that single phase meters were being opened, tampered with and closed up again.

“We are also partly private with our own business plans. is is part of our own diversification, aimed at being financially sustainable

How much electricity do you think was stolen? How much have your recovered?

Thanks to various initiatives, Enemalta is bringing in millions more... Those who were caught or who owned up have paid their dues, calculated on the basis of what the method of tampering was and what their bills should have been.

What about businesses? You had made a controversial decision that they would be able to conclude a repayment schedule rather than be forced into closure by paying in one go...

First we had to identify the theft, then estimate what the actual consumption would have been. Some paid immediately but not all of them were in a position to pay up as some of the amounts due were considerable. Yes, we discussed it with the businesses and agreed on repayments.

Personally, I think that the most

important thing for Enemalta is to stop theft and recover the value of the electricity stolen. If it is a choice between driving that company into bankruptcy or agreeing on a threeyear repayment, then for me, the choice is clear. I prefer to recoup the money.

With Marsa now closed down, and the interconnector in use, will people see an improvement in the reliability of supply and fewer power cuts? In 2013, each user lost power on average for seven hours every year.

We are not only investing in generation but also in distribution, since this is often the cause of power cuts. This is due to faults as well as to the load spiking at various times.

Our aim is to reduce outages and we invested in distribution centres, substations and networks.

We have new distribution centres in the pipeline. New equipment Marsa South will replace that which was severely damaged last August.

Marsa North will replace the one there is at Marsa Power Station; then there are also new centres coming at Pembroke, Manoel Island and Xewkija. These will reduce not only the frequency of power cuts but also the duration.

Most will be ready by the end of this year – although infrastructural works might mean some will be delayed until 2016.

For example, the Manoel Island one requires cables that need to pass through Sliema, which cannot be done during the summer tourist season. Connections are also needed to the Kappara distribution centre which is affected by the Kappara junction project. We are anxious to finish these centres as soon as possible, and have the budget for them, but there are restrictions which are outside our control. We are working hand in hand with the respective authorities.

With regard to services to businesses, the MRA report said it takes 242 days to provide a new service when a substation is needed. Seriously?

The 242 days is possibly misleading as we have been able to supply some in as little as 15 days. There is definitely scope for improvement and management is aware of it. We are working on reducing the time but we must also understand that some require cable connections to distant areas, and there are others that are covered by Mepa conditions. Sometimes the building that will house the substation also requires a permit. So again, not all the problems are within our control.

I am not trying to shove the blame on to others. There are many ways in which we can improve. We are here to acknowledge the problems and to change things.

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e Business OBSERVER

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May 7, 2015

CASE STUDY

Growing with EY’s Managed Services Four weeks in London. Joette Mallia was over the moon at the prospect of working in the British capital, knowing it would be a great opportunity to hone her skills with EY London’s client.

One placement followed another in quick succession as the project was extended – and before she knew it, she had been there for four years, working her way up from assistant to stints in risk management and compliance, becoming a manager.

She could never have guessed that the work placement would lead to the setting up of a Managed Services centre here in Malta – let alone that she would become its leader just a year later.

It is an ambitious project. EY Malta will be starting off with 50 people but will then take in 10 or so new employees a month.

“It all depends whether there is a pipeline of the right people to work in this sort of environment,”

“EY Malta prides itself on its flexibility with regard to work/life balance – and gender equality”

EY Malta’s country manager Ronald Attard said.

One of the key messages Mr Attard and Ms Mallia want to convey is that recruits can come from a wide range of backgrounds.

“I think there is a considerable amount of students who are not aware of what we need... We need risk professionals, mostly at graduate level, not only from University of Malta but also Mcast, who do not necessarily have any experience.

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“Apart from the fact that we will provide full training and induction – which is why we are taking on new employees in phases – they do not all need an accounting background; only those who do assurance would do that,” he said.

“But in other centres, like the UK, we attract graduates with very surprising backgrounds, like history and the classics. All we need are people with numerical skills and a big brain, who are willing to learn. It would be wonderful to do so here. We would love to give people the opportunity to benefit from the work experience and the career path. People are simply not aware of the careers that there are available in financial services. Being part of a global team opens numerous doors.”

“It would be a great opportunity for those who come here with a general bachelor degree in commerce, whether finance, insurance or management.

“The indications are very positive. We have already received some very interesting CVs from candidates,” Ms Mallia said.

Mr Attard is enthusiastic by nature but the new centre has really fired up his imagination.

“We have been sending people overseas for foreign engagements through EY London for some time and many people were very successful. At one stage we had 30 people working on various projects, either at the EY London office or at its clients. The Maltese have a great reputation.

“We realised that Managed Services is very much internetbased, and just as the clients could be anywhere in the world, so the work can be done from anywhere in the world,” Mr Attard said.

“So we asked ourselves whether we could offer these services directly from Malta, instead of sending people to the UK... Of course some of our staff love the opportunity to travel, and they will still have the opportunity to do so, but the centre will give dozens of people the chance to try a completely new career. And this is not only good for EY but also for Malta, especially since it is locally-

RONALD ATTARD AND JOETTE MALLIA BELIEVE ALL THEY NEED AT EY MALTA ARE PEOPLE WITH NUMERICAL SKILLS AND A BIG BRAIN.

generated and not foreign direct investment.”

The Managed Services centre will provide ‘know your customer’ services to clients in the financial services industry, networking with other centres in the EY family, predominantly – but not exclusively – those in the UK, which focus onbroader risk management for financial services.

The amount of due diligence required as a result on anti-money laundering directives has increased tremendously. Financial institutions need to identify not only their clients but also the source of their wealth.

The level of due diligence can vary from a straightforward check to enhanced due diligence, depending the nationality of the client if he or she comes from a sanctioned country, or if they are a politically exposed person.

Mr Attard believes that the centre could grow – and could be extended to other areas besides due diligence, such as processing financial statements and risk management.

“We know we can never be a big Indian-style centre with thousands of people – the EY Global

Talent Hub employs 30,000 there – because there are simply not the human resources in Malta to do that! But we can grow beyond 50, depending on whether we find the right people. We can’t see any reason why we should not grow to 200 within a few years.”

EY Malta thrives because of the diversity of its workforce and at present around 20 per cent of its employees is foreign. But Mr Attard is keen to encourage as many Maltese as possible to come forward.

“If we were to get another 20-30 people we would find work for them all. The challenge is finding enough people! As part of a global network, we can always find people to bring over – but we would love to attract Maltese.”

“The centre will help in a number of ways as they can work here for a few years – although many will see it as a long-term career. There will be several levels, from associates and assistants to executives and managers,” Ms Mallia said.

The 14-year-old company is currently remodelling the three floors it occupies in the Regional Business Centre in Msida – but it

will also be taking on additional space to cope with its ongoing growth. Work started on the designs in November and the construction and finishing work on all the floors should be completed by September.

“This year we will probably take on 70 full-timers –50 for the centre as well as another 20 for assurance, transactions and so on,” he said.

“We can take 100 people per floor so we have room to grow even further and there are plans to take over other parts of the building in the coming 18-24 months,” he said over the regular thumps from the construction work below.

“We like this location, for various reasons. It did not make sense to move out. It is very accessible and central, with good public transport connections. And even the parking will be easier as we have spaces in the blocks across the road too...”

EY Malta prides itself on its flexibility with regard to work/life balance – and gender equality.

“This would be great for working mothers or women coming back to work after a career break.

We could be very flexible in terms of working hours.”

The new offices will reflect this flexible approach. Although the Managed Services centre will have the traditional layout, the rest of the building will have a totally open-plan one. This will enable ‘hot desks’ so that staff can sit down wherever they find a space when they get into the office, while teams from various disciplines will be able to sit together when working on a particular project.

“We are no longer going to have all our tax people on one floor and advisory staff on another. It is a very efficient way to use space.

The nature of our work dictates that many of our staff are working in our clients’ premises. It doesn’t make sense to take up a desk for one staff member on a 100 per cent occupancy basis if the likelihood is that they will only use it one week a month.

“Some people will be almost permanently there, and others almost permanently out so I am sure that some desks will be ‘hotter’ than others,” he laughed.

“The work ethic here is very good and if there is work to be done people are willing to stay on, and even to work on weekends to meet deadlines,” he said, pausing for a moment before chuckling.

“Should we say that? We don’t want to put people off! We are a great company to work for!”

“One of the key messages Mr Attard and Ms Mallia want to convey is that recruits can come from a wide range of backgrounds”

e Business OBSERVER

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May 7, 2015

15

e Business Observer is Malta’s leading business newspaper distributed with Times of Malta every fortnight.

EDITORIAL

We need better property statistics When a sector is just ticking along as it always has, no one really pays much attention. It is only when things change that people take notice, realising that corrective action might be needed.

This is certainly the case in the property sector, where the few statistics collected are either tightly held by the private sector or are not pieced together to paint a complete picture.

The property sector is buffeted by numerous waves. Some, like the shrinking average family size, are slow, if relentless. Others have a dramatic and nearly immediate impact: a change in building height policy, accession to EU membership, an influx of young foreigners working with i-gaming companies, lower yields on funds and government stocks, fiscal initiatives for first-time buyers and an amnesty on undeclared rentals... All of these affect supply and demand.

Problems arise when the reaction of the market is a knee-jerk

one, with everyone jumping on to the bandwagon. This is why we have seen a rapid spike in the number of properties being built, from a few thousand a year, to almost 12,000, and back down again to a few thousand – all in just a decade.

And yet do we really know what is going on?

Take supply. No one needed Mepa figures to know that there was rampant overconstruction but what was being built and where was hard to map out.

Take property prices. Anyone who dared to suggest that there was an oversupply and thousands of vacant prices which might affect prices was shot down by arguments that the situation was different in various segments, and that the vacant properties were not really available for sale.

This is why stakeholders like the Federation of Estate Agents and the Building Industry Consultative Council have long lamented the lack of statistics, but

proper research has been hampered by the lack of funds.

Now, Re/Max has analysed its own figures to show the gap between the asking price and eventual selling price, which has dropped from 23 per cent in 2012 to 15.5 per cent last year.

Why is this important? Because for years, the Central Bank of Malta (CBM) has used the advertised price to calculate the property price index, which has always been disputed by stakeholders.

If the gap were stable, then the index would be valid as it would still capture the trends. If the gap changes, however, the index could be widely misleading.

The gap between asking price and selling price could reflect a number of things, from whether the property was valued too high, to how anxious the owner was to sell. The narrower the gap, the more mature and stable the market, as a speculative bubble or owners under pressure from

banks would affect both sides of the equation.

Without this information, we cannot determine which most accurately reflects reality: the CBM’s reported rise of seven per cent for 2014, or Eurostat’s report that it was 11 per cent? There are too many methodologies and too little context.

With as complex a market as property, knee-jerk reactions from the supply side are as dangerous as those to control the demand side. Just look at the impact of changing the policy to allow a third floor in two-storey zones.

Proper research should cover not only real estate agency sales but also direct sales and brokered sales, advertised prices and actual prices, time to sell and numerous other indicators.

The excuse has always been that no one is willing to pay for it.

Isn’t it about time the policymaker – government – exerted a little pressure on stakeholders, or coughs up itself?

Editorial Vanessa Macdonald, Head of Content (Business), Times of Malta.

Publishers Allied Newspapers Ltd. Content House Group Ltd.

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BUSINESS OPINION

Development beyond growth and financial targets

Malcolm Bray Positive economic news has been flowing at regular intervals this year. GDP growth in Malta compares favourably with that in the rest of the EU countries, fiscal targets are being achieved without much difficulty (apparently), while the European Commission, the International Monetary Fund and the various credit rating agencies have expressed positive opinions about the country’s economic performance.

Undoubtedly, sound policymaking, a depreciating euro, low interest rates, relatively low oil prices and a bit of luck are all contributing to this (the order of importance being hard to establish).

This positive economic scenario should, however, pave the way for greater focus on genuine development.

Economies exist to meet the expectations and well-being of their citizens. In this respect there needs to be a more holistic evaluation of the country’s performance. As the OECD puts it “there is more to life than the cold numbers of GDP and economic statistics”.

Indeed the OECD produces a Better Life Index which attributes well-being to a multitude of components beyond the narrow focus on GDP. This follows similar initiatives, with the Human Development Index compiled by the United Nations, being the most popular.

Well-being is supported by economic growth, as this makes available a larger set of goods and services for consumption by the population. However, we must not be misled by the arithmetic. Take, for example, an oil spill in the sea, which in turn requires the use of specialised resources to clean it up. This work effort gives rise to a paid service which thus increases GDP. But is society better off than if the oil spill had never occurred in the first place? The answer is clearly no – this simple example makes it clear that an increase in GDP should not automatically be associated with the impression of being better off.

Furthermore we have to keep in mind that economic well-being depends on productivity (the quantity of output produced per unit of time) and not necessarily on total output.

Countries which produce more because the average working week is higher are not necessarily better off than those countries which produce less but work less. Indeed, as part of economic progress, the average working week had tended to decline over time as technology has enabled workers to become more efficient.

Other elements which can be associated with a better quality of life are likewise missing from GDP. For example, the quality of housing, the extent of job security, the quality of the social support network, educational attainment, environmental preservation, civic

engagement and a healthy life are largely alien to GDP statistics.

Similarly, it is important to go beyond the mere adherence to fiscal targets.

Malta has traditionally enjoyed a strong centralised government, which facilitates the attaining of

“Boasting about GDP growth makes headlines but does not improve directly people’s well-being”

budget targets. Indeed, a revenue shortfall can easily be addressed by expenditure restraint – for example, by delaying some capital expenditure project, reducing road maintenance works or reducing the quality of the service provided.

Lower quality public services, such as the notorious waiting lists associated with healthcare, or educational institutions which do not have access to the right amount of resources, or inadequate police services, impact negatively on people’s welfare.

While official statistics classify Malta as a developed country, in order to state convincingly that Malta is indeed developed, we must address other factors which indicate a certain degree of backwardness, such as for example public gardens which are not well maintained, unsightly buildings, lack of proper control over egoistic lobby groups, lack of proper control of air and noise pollution, and low educational attainment, just to mention a few.

The country must thus use the current time window offered by the positive economic developments to address its areas of backwardness.

In the end, boasting about GDP growth makes headlines but does not improve directly people’s wellbeing. A cleaner environment, ensuring the respect of the law, and upgrading the country’s health and educational systems are closer to the people’s understanding of what improved standard of living really means.

e Business OBSERVER

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May 7, 2015

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APPOINTMENTS

Malta Maritime Law Association elections Ann Fenech has been re-elected as the president of the Malta Maritime Law Association, a post she has held since December 2008. Ivan Vella and Miriam Camilleri were re-elected as the vice presidents.

Other members elected to the executive committee are Daniel Aquilina, Matthew Attard, Chris Cini, Christopher Dalli, Jotham Scerri Diacono, Suzanne Shaw and Alison Vassallo.

The Malta Maritime Law Association (MMLA) is a nonprofit making voluntary organisation which was set up in 1994 with the aim of promoting the study and advancement of Maritime Law and its administration. The association has 86 members.

New oďŹƒcer New directors for at Fimbank

Global Capital

Former partners from KPMG and EY have stepped into vacant non-executive director posts at Global Capital.

Mario Galea was the managing partner and chairman of Ernst & Young Malta until he retired in 2012.

Joseph Schembri, who was a former senior partner at KPMG, will also act as the chairman of the company’s audit committee.

The chairman and directors appointed by the Mauritius-based majority shareholder of Global Capital stepped down recently following an alleged Ponzi scheme involving a subsidiary.

Ronald Haverkorn has been appointed as the chief risk officer at Fimbank.

A Dutch national, Mr Haverkorn is a senior banker with a track record in developing and executing growth strategies, managing global portfolios, measuring and implementing risk controls procedures and in developing risk management frameworks.

Mr Haverkorn was previously employed as executive vice president for the Wells Fargo Group.

Mr Haverkorn was appointed following the resignation of Ivan Fsadni.

Director for Izola Bank Francis Gouder has been appointed director of Izola Bank as from May 4.

Mr Gouder has extensive banking experience having worked for 45 years in the banking sector, both at branch and head office level, namely at Mid-Med Bank and HSBC Bank.

More recently he also worked at Banif Bank, as an adviser to the executive committee and later as head of private banking.

He presently holds a number of other non-executive directorships.

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e Business OBSERVER

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May 7, 2015

STOCK MARKET REVIEW

BOV in surprise double-digit profit growth

Edward Rizzo The interim results of Bank of Valletta plc published after the market close last Thursday ought to have caught many by surprise.

Following the weak performances of the other two retail banks – with both HSBC Bank Malta plc and Lombard Bank Malta plc suffering

from the challenging conditions across the banking industry – analysts and market participants possibly also expected a similar impact on BOV. However, the financial statements for the six months ended March 31, 2015, reveal a 15.9 per cent increase in pre-tax profits to €58.8 million. Core profits increased by 6.0 per cent to €42.9

million on the back of a 15.4 per cent increase in net interest income to €71.1 million (largely due to the decline in interest expense as depositors opted for shortterm, low yielding deposits) as well as the double-digit gains in non-interest income with a 20.7 per cent uplift to €48.4 million.

BOV reported that all business lines recorded improvements with

the most notable being trading profits which surged by 29.6 per cent to €11.35 million on the back of both an increase in volume of transactions as well as a widening of spreads.

Another significant positive contributor to the improved financial performance was the increase in the fair value movement from €4.7 million in the first half of the 2013/2014 financial year to €8.1 million during the period under review. Although movements in the bank’s portfolio of financial assets at fair value through profit or loss still have a material bearing on the group’s performance, it is important to note that in recent years, the bank has reduced the amount of such assets to €503.5 million compared to circa €1.3 billion as at September 30, 2014.

The positive trend across local, as well as international financial markets, also helped boost the share of profits of BOV’s insurance associate companies by 44.9 per cent to €7.8 million.

BOV also recorded a €6.8 million (net of deferred tax) gain on its available-for-sale portfolio.

However, this figure is recognised in shareholders’ funds (through the revaluation reserve) in line with accounting standards.

The interim financial statements also reveal a significant increase in operating expenses

(+17.4 per cent to €54.6 million), in the main due to a further substantial rise in regulatory costs which now account for 12 per cent of the group’s cost base compared to 4.0 per cent in previous years.

During a recent meeting with the financial community, BOV’s chief finance officer Elvia George explained that regulatory costs are expected to remain at such elevated levels going forward.

Additionally, impairment allowances also increased by 40.9 per cent to €13.9 million reflecting the even more conservative approach adopted by the bank towards provisioning and collateral valuation in line with the recommendations made to the bank following the Asset Quality Review and stress tests carried out last year by the European Central Bank (ECB). Apart from the bank’s wish to improve its coverage ratios, the impairment for the period under review also reflect the adverse effect of the instability across North Africa, especially Libya, on certain local businesses.

The Statement of Financial Position once again showed that the growth in the bank’s deposit base outpaced the net increase in the loan book. During the six months ended March 31, 2015, BOV’s customer deposits grew by 9.2 per cent or €657.7 million. On the other hand, net loans and

“In recent years, the bank has reduced the amount of such assets to €503.5 million compared to circa €1.3 billion” JOHN CASSAR WHITE

e Business OBSERVER

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May 7, 2015

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STOCK MARKET REVIEW

Bank of Valletta plc - Profit after tax and Return on Equity 50,000

20%

45,000

18%

40,000

16%

35,000

14%

30,000

12%

25,000

10%

20,000

8%

15,000

6%

10,000

4%

5,000

2%

-

2010

2011

2012

2013

2014

2015

Profit after tax

29,230

30,348

31,980

44,538

34,449

40,163

ROE (post tax)

13.9%

13.2%

13.2%

17.2%

12.2%

13.1%

Return on Equity (%)

for the six months ended 31 March 2010 - 2015

Net Profit ( millions)

advances only increased by 3.1 per cent or €121.3 million with the growth largely emanating from home loans. As a result, the bank’s loan to deposit ratio slipped further lower to 51.2 per cent – the lowest level for several years.

During the analyst meeting convened shortly after the publication of the financial statements, BOV’s chairman John Cassar White, CEO Charles Borg and other top executives as usual gave a detailed account of the developments over the financial period under review.

However, analysts were probably more interested in an update on developments regarding the Italian court case, which was not included in last week’s company announcement. The chairman stated that the bank was notified about the case in mid-December 2014 and lawyers were called in immediately while the regulators were also notified of the case. The chairman defended the fact that the company announcement was only made on April 2 since both the lawyers and the auditors required sufficient time to examine the lengthy documents and reach their own conclusions.

However, it is worth pointing out that when BOV issued its customary Interim Directors’ Statement on February 6, 2015, explaining the performance since the start of the new financial year on October 1, 2014, the directors confirmed that “during the financial period commencing on October 1, 2014, up to the date of this announcement, no material events and/or transactions have taken place that would have an impact on the financial position of the bank or the group, such that they would require specific mention, disclosure or announcement pursuant to the applicable Listing Rule”.

Given the magnitude of the claim, market participants would have expected mention of the Italian court case at this stage, notwithstanding the fact that the directors had not yet had feedback from their lawyers and the auditors on whether such a claim ought to have been partly provided for.

0%

“Regulatory costs now account for 12% of the group’s cost base compared to 4% in previous years” Although the chairman stressed again that BOV has an extremely strong case and that no provisions will be necessary for the time being, the uncertainty over this case could cloud sentiment towards the bank for many more years to come. Court cases normally take several years to reach a conclusion unless an ‘out-ofcourt’ settlement is agreed to and this could prove to be a costly exercise for the bank.

During last week’s meeting, BOV’s chairman also mentioned that a decision had been taken by the Board of Directors earlier that day for the bank to gradually start to reduce their holdings of Malta Government Stocks via the QE programme

currently being conducted by the Central Bank of Malta on behalf of the ECB. Given the size of BOV’s portfolio, even a small reduction in exposure could imply that the Central Bank will start to easily manage to fulfil its €36 million acquisition quota on a monthly basis until September 2016 or earlier if the ECB obtains data on a consistent improvement in inflation readings. In fact, statistics published by the ECB earlier this week indicated that the CBM purchased €58 million worth of MGS during the month of April compared to only €5 million in March.

Mr Cassar White also indicated that the upcoming strategy for

BOV entails the introduction of reforms to improve the bank’s understanding and management of its risks. This comprises substantial investment in the Group’s IT infrastructure (through a three- to four-year IT investment programme) as well as the engagement of personnel in this field in order to ensure timely, accurate and high-quality reporting in line with more stringent requirements of local and foreign regulators.

In the meantime, the bank will also be required to strengthen its balance sheet by raising capital levels. This could either take the form of additional equity such as a rights issue or long-term debt funding from the capital market.

Rizzo, Farrugia & Co. (Stockbrokers) Ltd (RFC), is a member of the Malta Stock Exchange and licensed by the Malta Financial Services Authority. This report has been prepared in accordance with legal requirements. It has not been disclosed to the company/s herein mentioned before its publication. It is based on public information only and is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The author and other relevant persons may not trade in the securities to which this report relates (other than executing unsolicited client orders) until such time as the recipients of this report have had a reasonable opportunity to act thereon. RFC, its directors, the author of this report, other employees or RFC on behalf of its clients, have holdings in the securities herein mentioned and may at any time make purchases and/or sales in them as principal or agent, and may also have other business relationships with the company/s. Stock markets are volatile and subject to fluctuations which cannot be reasonably foreseen. Past performance is not necessarily indicative of future results. Neither RFC, nor any of its directors or employees accept any liability for any loss or damage arising out of the use of all or any part thereof and no representation or warranty is provided in respect of the reliability of the information contained in this report. © 2015 Rizzo, Farrugia & Co. (Stockbrokers) Ltd. All rights reserved

No further news was provided at this stage. As such in the months ahead, BOV’s stakeholders and all market participants will be keen to understand the nature and timing of this capital raising exercise.

Whatever the shape and form of this capital raising exercise, it further vindicates Mr Cassar White’s statement that generally banks are becoming a safer investment but less profitable than in the past reflecting the regulator’s stance of focusing on risk management even at the cost of lower profits.

Edward Rizzo is a director at Rizzo, Farrugia & Co (Stockbrokers) Ltd.

e Business OBSERVER

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May 7, 2015

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BUSINESS UPDATES

Opel Corsa best fit for company car fleet

Malta Chamber signs MoU with Omani Chamber of Commerce and Industry The Malta Chamber of Commerce, Enterprise and Industry and the Omani Chamber of Commerce and Industry (OCCI) signed a memorandum of understanding on April 22 in a bid to promote business collaborations between the two countries.

The MoU was signed by Tonio Casapinta (picture, left), vice president of the Malta Chamber and Said bin Saleh al Kiyoumi (right), chairman of the OCCI. The MoU was signed during the visit of a Ministerial delegation to the Sultanate of Omani, led by Chris Cardona, Minister for the Economy, Investment and Small Business.

During presentations held at OCCI, Mr Casapinta said that the Malta Chamber strived to

promote collaboration on an international level, to create visibility for Malta in the region and through its Middle East Business Council has created mechanisms which supported business collaboration and investment.

The Maltese delegation had discussions with Omani government ministries, agencies and leading corporate organisations which showcased potential avenues for joint collaboration between the two countries.

During the visit to Bank Muscat another MoU was signed between Malta Enterprise and Bank Muscat, the leading financial services provider in Omani, for the setting up a business forum for SMEs.

A sneak peek into online marketing A good grasp of social and online tools is imperative in today’s highly competitive digital market.

As an eBusiness consultant with KPMG Crimsonwing, eresia Mallia, is often asked how a business can reap the advantages digital marketing has to offer. Here are some of her tips: • Make sure to use e-mail marketing. While it’s been around for a while, never underestimate its value.

• Use data and analytics. When in doubt, data can help you make the necessary decisions.

• Use a mixture of digital and traditional advertising.

• Sharing content on social media should be a personal experience. People share things on social media based on emotional triggers and relationships.

Companies should use this as an opportunity to raise brand awareness.

• Optimising content for SEO is ideal to reach your long term search engine ranking goals.

However, for immediate high search engine rankings, pay per click advertising is the answer.

• Testing and experimenting need to be as important as having cool and usable features and a fast and attractive website.

■ If you have any queries, contact eresia Mallia by e-mail on tmallia@crimsonwing.com.

KPMG Crimsonwing is an international IT implementation partner focusing on Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), eCommerce and integration.

The recently launched Opel Corsa ticks all the boxes as a smart car to complete or update any company car fleet. Together with the Astra, the Corsa is Opel’s winning horse and the fifth generation follows a 32-year evolution.

Coming in various variations including a commercial van, it is a multipurpose commodity for any company seeking to upgrade its fleet. The Corsa’s size makes it easy to park and its low fuel consumption makes it economical.

Thanks to its thoughtful design and build, the Corsa is both comfortable and sturdy. It is also convenient for connectivity, as its IntelliLink integrates smartphone functionalities without distracting the driver. Its active safety features

and innovative driver assistance systems also protect the driver and passengers, who may get tired after a day facing traffic and demanding clients.

The Corsa’s enhanced appeal boosts any company image with its striking looks and signature brand styling elements.

The Opel Corsa comes with a five-year guarantee and 12 years warranty on the body. For more information contact Cars International of Mdina Road, Qormi, email opelsales@cil.com.mt or call 2269 2122. You can also visit opel.com.mt or Facebook page Opel Malta.

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e Business OBSERVER

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May 7, 2015

BUSINESS ??UPDATES

Helping you create your dream home Sphinx Creations Ltd is a family-run business specialising in full turnkey installations. Established in 2002, our company has the experience to undertake any type of project ranging from the finishing of a shell apartment to the construction of a villa, and anything else that falls under the construction and finishes umbrella. Our team of hand-picked, skilled and experienced workmen which cooperate to achieve the same goal guarantees that each and every project receives all the attention that it requires. For Sphinx Creations, a job worth doing is worth doing well, which is why the company measures its success by the level of customer satisfaction.

The company works towards ongoing contact with its clients from the design stage up until the final commissioning of a project, allowing its project managers to be

Pender Gardens progressing well Construction is progressing well on the final phase of Pender Gardens, and completion of the project is scheduled for Q1 of 2018.

Phase one consisted of 150 apartments which were sold and are now occupied.

This was followed by Block 16, housing 46 apartments, of which 36 have already been sold on plan. Handing over of the apartments is planned for between July and October. Four retail units in Block 16, at street level on St Andrews Road, will also be available for rent. They have high visibility and come in varying sizes with the additional benefit of a permit for a mezzanine level.

The final phase will be a mix of residential, business and retail. Block 17 will house

46 apartments, and the higher floors of the Towers, T1 and T2 will comprise 30 luxury apartments. The first seven floors of the Towers will house over 5,000 square metres of office space. The apartments and offices will have a separate lobby and three lifts each, as well as a supermarket, wellness centre with outdoor pool and deck area, and retail units. Additional residential car parking will be available at level -1, with ample underground public parking at levels -2, -3 and -4.

The apartments in Block 17 will be launched on plan in November, and expressions of interest for the retail units, supermarket and the wellness centre are being received.

hands-on and always there to answer any questions that clients may pose. Sphinx Creations has established itself through word-of-mouth and works closely with both architects and designers to achieve each client’s vision of their dream home.

Hit show Completely Hollywood (abridged) in Malta Three actors getting through 186 films in just 90 minutes? Impossible right?

Well apparently not if you are Alan Montanaro, Joe Azzopardi and John Montanaro, who are currently starring in Completely Hollywood (abridged) at the University Theatre in Msida.

The show, written by the Reduced Shakespeare Company, sees the comic trio steamroller their way through all things Hollywood in a frantic blur of costumes, props and improvised dialogue.

Completely Hollywood (abridged) has been performed all over the globe, from the Edinburgh Fringe to New York, garnering rave reviews. It has been described as “Pure Genius!” by the Daily Express, “Hilarious!” by the Daily Mail and “An Instant Classic!” by the BBC. The local show by Mostly Harmless Productions opened last weekend and continues this weekend.

The Mostly Harmless team’s other credits include Yes, Prime Minister, My First Time, God’s Official, Legally Blonde and

the Reduced Shakespeare Company’s other smash hit, The Complete Works of William Shakespeare (abridged).

Completely Hollywood (abridged), is being performed at the University’s Sir Temi Zammit Hall tomorrow, Saturday and Sunday at 8pm, lasting for approximately two hours including intermission.

Tickets, priced at €15, and more information are available from the website www.mostlyharmless.com.mt