Business

Welsh business confidence ticks higher, but output and employment fall at faster rates

Published

4 months ago

January 12, 2024

THE HEADLINE NatWest Wales Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s manufacturing and service sectors – registered 48.0 in December, down from 48.5 in November, to signal a modest and quicker drop in output at Welsh businesses. The fall was due to weak client demand, economic uncertainty and a further decrease in new order inflows. The sharper decline in activity in Wales contrasted with the wider UK trend, which indicated a moderate upturn. In fact, Welsh firms recorded the second-fastest drop in output behind the North East of England.

Welsh companies registered a further contraction in new business at the end of 2023, although the rate of decline eased for the second successive month. The continued drop in new orders was linked to subdued demand conditions and customer postponements. The pace of decrease was modest and the slowest since September, though it contrasted with the UK average which indicated a moderate expansion in new business.

Manufacturers and service providers alike in Wales recorded contractions in new orders.

December data signalled an improvement in expectations regarding the outlook for output over the coming year at Welsh firms. The level of optimism reached a five-month high and was stronger than the series average. Companies noted that positive sentiment was due to hopes of a pick up in customer demand, investment in product diversification and facilities, and the acquisition of new clients.

The degree of confidence remained slightly weaker than the UK average, however.

Welsh businesses recorded a fifth consecutive monthly decrease in workforce numbers during December. The rate of job shedding accelerated to the joint-fastest in over three years and was by far the strongest of the 12 monitored UK areas. Weak customer demand led firms to reduce staffing numbers, with redundancies mentioned by panellists.

Employment fell at Welsh manufacturers and service sector firms.

Businesses in Wales indicated another monthly decline in backlogs of work in December. The drop in the level of outstanding business was marked overall and sharper than the UK trend. Firms highlighted that lower new order inflows enabled them to process incomplete work. Nonetheless, the pace of reduction slowed to the weakest in seven months.

Average input costs faced by Welsh firms increased at a quicker pace at the end of 2023. The rise in input prices was attributed to greater raw material and component costs.

Although sharp, the rate of cost inflation was slower than the series average and the trend seen across the UK as a whole. In fact, of the 12 monitored UK areas, only the West Midlands, North East and Northern Ireland recorded slower upticks in operating expenses.

Welsh firms registered a sharper rise in output charges during December, with the rate of inflation picking up to the fastest since August. Anecdotal evidence stated that higher selling prices were due to the pass through of greater costs to customers.

In line with the trend for input costs, the pace of increase in output charges was slower than the UK average, with only Northern Ireland, the North East and the North West recording weaker upticks in selling prices.

Jessica Shipman, Chair, NatWest Cymru Regional Board, told The Pembrokeshire Herald: “The final month of the year signalled more upbeat sentiment among Welsh firms regarding activity in 2024 as business expectations were the strongest since July, despite output and new orders continuing to contract. Companies anticipated that more accommodative demand conditions and investment in new products and facilities would drive output in the year ahead.

“Although the pace of decrease in new business slowed, reduced backlogs of work led to dwindling activity and the joint-fastest drop in employment since October 2020 as business requirements waned further.

“Meanwhile, rates of inflation remained sticky as input costs and output charges rose at faster paces. Sharper hikes in component and raw material costs were passed through to customers despite a challenging demand environment. Nonetheless, rates of increase were among the weakest in around three years and much slower than the 2023 average as inflationary pressures eased substantially from the start of the year.”

Business

Paul Butterworth appointed Vice Chair of Regional Learning and Skills Partnership

Published

3 hours ago

May 7, 2024

Richard Lewis

Paul Butterworth, the CEO of Chambers Wales South East, South West and Mid, has been appointed as the new Vice Chair of the Regional Learning and Skills Partnership (RLSP) for south-west Wales.

Covering Carmarthenshire, Neath Port Talbot, Pembrokeshire and Swansea, the RLSP is dedicated to bridging the gap between education, skills, and regeneration. It aims to ensure that the skills provision is aligned with the economic priorities and opportunities of the region, as well as tackling the new skills landscape that is happening within the energy, construction, manufacturing and digital sectors.

As CEO of Chambers Wales, Paul brings a wealth of experience and a passion for the economic and skills development of Welsh businesses with him to the board.

As the voice of the business community with policymakers, Paul will advocate for enhanced skills training, infrastructure improvements and the creation of skilled jobs, all aimed at creating local economic growth.

Upon his appointment, Paul said: “I am determined to create a better and fairer business landscape for West Wales to ensure that the local economy has the best available skills development for future project development and the transition into the green economy and energy sector to ensure West Wales thrives.”

Jane Lewis, Regional Partnerships Manager at RLSP, said: “We are delighted to have Paul on the board. He will be instrumental in achieving our goals and look forward to the positive impact his appointment will have on the region.”

Business

Expansion for Ashmole & Co with acquisition of Jones Ward Accountants

Published

2 days ago

May 5, 2024

Tom Sinclair

CHARTERED, Certified Accountants, Ashmole & Co, are delighted to announce their expansion following the acquisition of JonesWard accountancy firm in Carmarthen.

Ashmole & Co Carmarthen has today taken over JonesWard who have closed their office in Lammas Street, Carmarthen. All JonesWard staff, including Ian Jones and James Ward, have transferred over to Ashmole & Co and will be based in the Old School, the Quay, Carmarthen.

JonesWard informed their clients that the administrative burden of running a practice had increased significantly over recent years due to the constant changing money laundering and tax regulations, software requirements and so on. Over the past 12 months it had become more challenging to maintain the level of service they had been used to providing.

Ian Jones said, “We feel Ashmole & Co share the same values as us and have the necessary expertise and resources to ensure we can continue to provide the personal touch and level of service clients have been accustomed to. Myself and James are not retiring but we will be supported by Ashmole & Co’s partners and staff from now on in their Carmarthen office.”

Ashmole & Co partners Sharon George, Carwyn Morgan and Vinal Patel will strive to ensure JonesWard clients will continue to receive the high quality of service they are used to.

Vinal Patel, Partner with Ashmole & Co said, “It is our priority to make the transition as smooth as possible with all employees of JonesWard having already transferred to Ashmole & Co and are now based in our office on the Quay in Carmarthen. We look forward to meeting our new clients and working closely with them to meet their needs in the future.”

Ashmole & Co Chartered and Certified Accountants have been established since 1897 and are one of the largest accountancies and auditing practices in south Wales, now operating from thirteen offices throughout south and west Wales including Swansea, Carmarthen, Haverfordwest and Ammanford.

Business

Dragon LNG explores integration of LNG and CO2 liquefaction processes

Published

2 days ago

May 5, 2024

Tom Sinclair

DRAGON LNG, based in Waterston, Milford Haven, recently announced a significant step towards sustainable energy solutions.

The company awarded a contract to Worley, global professional services company of energy, chemicals and resources experts, to conduct a comprehensive feasibility study.

The study is focussing on exploring the potential benefits of integrating LNG (Liquefied Natural Gas)
regasification and CO2 (Carbon Dioxide) liquefaction processes at Dragon LNG’s facilities. This integration holds promise for a more efficient operation, with the potential to reduce energy consumption, carbon intensity and the levelized cost of CO2 export not only at the Dragon site but also for Haven industry companies.

If feasible, the technology at Dragon would support wider collaboration with RWE Pembroke Net Zero Centre, whose CO2 would be transported to the Dragon facility for processing before being shipped via non-pipeline transport (NPT) to carbon sequestration sites.

Key aspects to be addressed in the feasibility study include:

Technical Solutions: Worley will evaluate various technical approaches to seamlessly integrate LNG and
CO2 liquefaction processes, ensuring optimal energy efficiency and effectiveness.
Carbon Intensity Reduction: Dragon LNG is committed to sustainability, and the study will assess how the integration of processes can contribute to lowering the carbon intensity of operations, aligning with broader environmental goals.
Economic Viability: Understanding the financial implications is crucial. The study will delve into the levelized cost of CO2 and other economic factors to determine the feasibility and financial benefits of the proposed integration.

Commenting on the partnership, a spokesperson for Dragon LNG stated, “We are excited to collaborate with Worley on this important initiative. As a responsible energy provider, Dragon LNG is continuously seeking innovative ways to enhance our operations while minimizing our environmental footprint. This feasibility study represents a significant step towards achieving those objectives.”

Worley’s expertise in engineering and consultancy services including in the CO2 and LNG sectors makes them an ideal partner for this endeavour. Their track record of delivering sustainability solutions aligns perfectly with the ambitious goals of Dragon LNG.

This collaboration underscores Dragon LNG’s commitment to driving sustainable practices within the energy sector. By exploring the integration of LNG regasification and CO2 liquefaction processes, the company aims to pave the way for a cleaner, more efficient energy future with their ambition of a net zero terminal by 2029.