El Corte Inglés approved at the general shareholders’ meeting all the items included in the agenda with 98.5% support. Among the most important proposals are to reduce the distribution of dividends to 37.5 million euros, 50% less than last year, reducing the minimum number of directors to eight and the absorption of its Sfera fashion chain. In her speech, the group’s president, Marta Álvarez, explained that «We have an exciting and long-term project» which has given very satisfactory results in 2019 and added that, despite the difficulties of recent months, El Corte Inglés has a solid and united team capable of facing the future with guarantees of success. He also made reference to the pillars on which the company’s business will be based: the commitment to quality products and services, the shopping experience, digitization and the development of new projects.
The shareholders’ meeting was historic because, apart from the fact that the shareholders could attend telematically for the first time in history The company did not take place on the last weekend of August. One of the highlights has been to reduce the minimum number of directors, with fewer than ten. A move that responds to the strategy of the department store group to take certain behaviors similar to those of listed companies. Furthermore, the intention is that more independent directors should join the board. A tip that will continue to have the presence of Marta Álvarez, Cristina Álvarez and Shahbad Shahbaz for the next five years, which have been renewed today. In addition, the board has appointed José Ramón de Hoces as secretary advisor.
Another point approved was the reduction in the distribution of dividends charged to the 2019 accounts. Specifically, this year the group will distribute 37.5 million euros among its shareholders, 50% less than last year. And it is that despite the fact that in 2019 it achieved 310 million euros of profit, the largest in the last nine years, the health crisis has caused El Corte Inglés allocates 251 million euros to reserves. It must be remembered that due to the pandemic, El Corte Inglés had to perform an ERTE on almost 26,000 employees, since all its centers were closed except for the food section and the online service. According to Marta Álvarez, online sales have multiplied by five and home delivery by six in recent months.
Also in the months of the state of alarm, and to face the crisis with guarantees, El Corte Inglés reached an agreement with fourteen banks to achieve a credit of 1,311 million euros with maturity of one year. This amount added to the 2,000 million euros of its debt that it refinanced with banks last February, maturing in 2025.
The third point of importance approved at the meeting the absorption of its Sfera fashion division by the group’s parent company. A maneuver similar to the one he performed in 2017 with Hipercor and last year with Bricor. As in those operations, the company explains that it will serve to “improve and complement the commercial offer, while taking advantage of the synergies between the two formats.” So, only Supercor remains as the only separate retail division from department stores.
An absorption that will have no consequences on employment, as pointed out by El Corte Inglés. And is that the behavior of Sfera in recent years was positive. In the latest known results, those of 2019, the fashion chain billed 461 million euros, 8% more than the previous year. In addition, more than half of its sales came from its own stores.
The last year of El Corte Inglés has not been without movements in the leadership. Thus, in January of this year it was learned that Jesús Nuño de la Rosa, the predecessor in the presidency of Marta Álvarez, was leaving her position as CEO, an activity she shared with Víctor del Pozo. In addition, also restructured part of his business in order to reduce its debt, which amounts to 2,729 million euros. Thus, in December it was agreed to sell the IT business to the French GFI. Before en October, he created his real estate division as the sale of the least profitable centers that he commissioned to PwC failed and he was able to manage these divestments himself.
Activity in confinement
Mara Álvarez did not want to stop highlighting the work that the company has done during the months of alarm. Specifically, she explained that El Corte Inglés. made its resources available to public institutions, donating all kinds of priority material to institutions, hospitals and nursing homes, in addition to helping people with fewer resources by collaborating with numerous organizations. Now, and after having spent the first critical months of the pandemic, the group’s president is focused on the “objective of continuing to move decisively towards a dfinal recovery ».