Financial Information

As Irish unemployment increases and our economy struggles, it’s great to hear of successes being achieved. The IEDR have announced in their annual report that .ie registrations are going from strength to strength.

Donal O’Nuallain from the IEDR released in a recent newsletter the following highlights :

• 2010 new .ie domain registrations were 36,587 (37,055 in 2009)
• Total .ie domains increased by 12.9% year-on-year to 153,419
• Registration fee income increased by 9.7% to €2.56 million
• Registry operating costs up by 1.6%
• Operating profit up 50% to €582,639
• .ie increased market share by 1.6% to 41.5% (compared to .com and .eu)
• 150,000th .ie domain registration milestone passed
• McAfee security survey reported .ie namespace remained in the top five safest in the world.

The IEDR (IE Domain Registry) are the government agency that manage the registration of .ie domain. This performance year on year will enable the IEDR to invest in the development of the .ie domain registration system. Which some will know can cause frustration. Although the current registration process is how the .ie domain name is classified as one of the top 5 safest in the world.

Donal is the Marketing Executive at IE Domain Registry Ltd and in his newsletter he said the following,

IEDR performed strongly in 2010 during a difficult year for the Irish economy. Registration revenue increased to €2.56 million, a 9.7% increase on 2009, reflecting volume growth of 26.9%, offset by price reductions and price promotions. Cost control measures were balanced by the strategic priority for ongoing investment and stakeholder outreach activities. Administration expenses of €892,062 represented a 6.7% increase compared to 2009 and employment costs increased by 24.5%, as average employee numbers increased from 12 to 15, reflecting the recruitment of additional technical services and other staff during 2010.

This report releases the top 10 domain registration companies in Ireland for 2010 :

The Bank of England (BoE) has reported a sharp fall in mortgage lending during the month of July as activity in the housing market remained subdued.

June’s figure for net lending was £500,000,000 and forecasts for the month were £700,000,000. However, net lending in June reached a total of just £86,000,000.

This figure is the second lowest ever recorded since the records began in 1993.

On the plus side, there was an unexpected rise in the number of mortgages approved and the amount of consumer credit. The figures are a slight improvement on June’s figures but were still in defiance of analysts’ predictions of a fall.

A leading economist stated that the figures backed up the forecasts of a fall in house prices in late 2010 and early 2011.

Retail sales rose by 1.1% during the month of July exceeding expectations.

This is the highest month-on-month rise since February and has beaten the forecasted rise by 0.7%. The increase is most likely on account of the largest drop in clothing and footwear prices for eight years. Sales for the year so far are also up 1.3% when compared with last years sales although government measures are likely to hit high street stores hard.

VAT is likely to rise to 20% come January while fears over unemployment and general cutback do not bode well for the coming year.

Inflation decreased very slightly last month but is still above the government’s target of 2%.

While July saw petrol prices fall it also saw the highest increase of food prices for two years, maintaining the cost of living well above the Bank of England’s target. The Consumer Prices Index fell from 3.2% to 3.1% meeting expectations but meant that Governor Mervyn King had to send an open letter to the Chancellor to explain the high inflation level. Mervyn King has sent seven such letters since April 2007.

The CPI rate has remained above 3% throughout 2010 due to the hike in the VAT rate in January as well as rising food costs. The Russian drought is likely to maintain pressure on food inflation over the coming months.

Ultimately the UK is continuing to recover from the recession but has not met the targets of the Bank of England. The revised targets see the economy expected to grow by 2.5% rather than 3.4% and VAT likely to remain above 2% until the end of next year.

Motorists are set to see petrol prices rise to about 120p a litre by the end of this month.

The warning came from Retail Motor Industry Independent Petrol Retailers Association (RMI) chairman Brian Madderson. The organisation represent two thirds of the petrol forecourts in Britain.  This weekend, a litre of petrol came in at 116.65p, but the expected price hike would see petrol hit 121p per litre, a tiny fraction off the record high achieved in May of this year.

The rise in price will be a result of increases in the price of crude oil but also of the rise in VAT and the government’s planned rise in fuel duty.

The RMI chairman went on to predict that prices could reach 125p in the new year, smashing the previous record.

The price increases could be crippling to motorists and independent retailers alike especially in rural areas where there is little competition.

An RAC spokesman asserted that the “if the government really wanted to help motorists, they should abandon these planned increases.”

The Bank of England has maintained a 0.5% interest rate.

The surprise 1.1% jump in GDP did not sway the decision of the Monetary Policy Commission who have decided to keep the rate at the same level it has been since March of last year.

Experts have welcomed the bank’s decision and stated that economic stimulus was still needed by both businesses and consumers. Businesses are finding banks are still not lending and consumers aren’t brave enough to spend in the uncertain environment we find ourselves in.

Economic experts agree that the interest rate is unlikely to rise until the middle of next year especially with the full brunt of Government spending cuts still not being felt. Some experts have even predicted that the rate will not rise until at least the beginning of next year.

Many experts seem unwilling to put a specific prediction on when the rates will rise but warned that raising the interest rate too soon could lead the country back into recession.

Ultimately, the general expectation seems to be that we will not see a rise in rates until at least May of next year.

So, after 6 quarters of negative growth between spring 2008 and autumn 2009 is the UK economy on it’s way back?

With government spend in the UK during the first three months of this year providing a false effect of increase in consumer spending. It has actually been reported that the consumer spend dropped over the first 3 months of 2010. With the government spend now cut, what is the result going to be as job losses and higher taxes cause spend to drop even further.

These new figures placed this latest recession as the toughest since the Great Depression of the 1930s, harsher even than the slump of the early 1980s.

Despite the pick up in activity at the end of last year, output was 0.2% lower at the end of the first quarter of 2010 than it had been a year earlier.

The Guardian had this to say about 2010 finances : “The country’s budget shortfall was the third largest in the EU last year but will overtake both Greece and Ireland this year, according to the forecasts. Greece’s measures to tackle its public finances problems are projected to cut its deficit to 9.3% of GDP.”

So the answer to our Post question is a resounding…Not Likely!