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The catering ‘apnea’ reduces Newrest Spain’s business to a tenth

The catering ‘apnea’ reduces Newrest Spain’s business to a tenth

During the suspension of catering services on board planes and trains The first year of the pandemic hit Newrest’s business hard. Until then, the airline and rail catering multinational had to adjust its workforce in September 2020, six months after the coronavirus outbreak. The result is that a quarter of its workforce in Spain, around 450 employees, has left within a mixed procedure of collective dismissal and temporary employment regulation.

Although unions called the measure “disproportionate and opportunistic” at the time, the latest accounts confirm the “economic problems” the company claimed. Newrest Spain achieved a turnover of 13.8 million euros in the fiscal year 2021 (which ended on 30 September last year), which meant a drop of 65% compared to the previous one.

The turnover is far from the 39.8 million euros achieved in 2020, where its activity was frozen during the second half of the year due to health restrictions. But even worse, a practically insurmountable distance in relation to pre-pandemic levels, as it represents 15% of the volume registered in 2019when he entered 93.2 million euros.

The company admits in its management report that this 85% drop in turnover in just two years forced it to keep part of its workforce in ERTE during 2021. However, if at the end of this year the percentage reached 34 % of employees, in November. it fell to 20% thanks to the increase in international air activity. Recovery shown in that sales figures reached 5.4 million during October and November 2022, 455% more than in the same period of the previous year (976,000 euros).

But although the coronavirus seems to be under control, there is another factor that puts Newrest directly at risk, and that is the impact of the evolution of fuel prices on airlines. Proof of this is that there is already a reduction in demand for services. Before this Overview, their managers are trying to increase their client portfolio, as evidenced by their agreement to operate rail catering with Ferrovial.

However, the recovery is expected to be slow and very volatile. For this reason, the group of French origin focused its efforts
in cost protection and treasury protection, to ensure continuity and to prepare for the future. The measures taken include the 12-month increase in the amortization period for loans with ICO guarantees for 20 million euros received at the beginning of the health crisis.

Globally, the holding company reached a figure of 141.7 million euros in 2021of which 21.8 million came from the catering business, which represents a 32% decrease compared to the 32 million received in 2020.

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