Iñigo Meirás (Logista): "Esta crisis rompe paradigmas; está demostrando que el teletrabajo funciona"

Well, I'm very good here, enjoying this confinement even though we are forced, but I think it's essential to get out of this situation. Sometimes it even gives us time to think, something that daily hurries don't allow. Without a doubt, we have to take advantage of it to do certain things, think a little more, organize ideas, and why not, put a little more order in our homes where we spend little time, we have a lot of time to do. That's good.

Well, let's go to it. The logistics and distribution sector in Spain, including transport of course, I think has two clearly different realities. There is one part of distribution and logistics that is affected by the royal decrees published by the government and therefore have had to stop their activity. Then there is the positive part, the more fortunate sectors, although we have a large network of pharmaceutical companies whose production centers are in this area throughout Europe. That brings the special complexity at this moment that in border cases they have to stop the goods as well, which is complicating the operation. But as of today, I think it is being said from the political class and it is true, it is being achieved to save and maintain the level of distribution at an adequate level compared to the normal life of the company. In terms of percentage, we are at 50%, we are at half throttle because we cannot be more, we are with other work methods but we are... Let's go to us in the Logista group, the largest logistics company headquartered in Spain. Basically we have three very important markets: Spain, Italy, and France, which is a little bit our own, and then we also have an important presence in Portugal but we don't have the market share we have in those three large countries. Then we have a certain presence in Poland. All these markets are affected by the pandemic and in all of them decisions have been taken like confinement of the population and stopping parts of production. In our case, I think we must be working right now at about 80%, since a large part of our activity is in services or sectors that have been considered essential in all those countries: France, Italy, Spain, Portugal. So we work with problems, it's not a normal situation, but the reality is that the service has not fallen at any time. Working at 80%, we are managing to serve everything that comes into our distribution chain to the different points of sale, to hospitals directly.

We have indeed learned from what was coming ahead in those markets, because I think Spain was about two weeks behind and France possibly a week behind Spain. So we started taking measures right away, but under three basic ideas: mainly how to maintain operations, what measures we had to take so that the first priority was the health of the employees, with a double focus: one to help maintain activity and their own health. In the Italian case, we took measures right away. We started working with masks, with the famous PPE, and we provided them at a time when there was still no shortage like there is now in all the countries we operate in. That was a first measure. Second, we started taking measures to facilitate teleworking. It has always been said that we must be prepared for it, but in Logista's case, we have about 6,000 employees, of which up to 2,000 could telework, and right now about 1,500 are teleworking, and it is working with quite a lot of normality, although we must recognize that it is a new experience for large companies like Logista. Third, what we did in the Italian case and then exported here is how we prioritized the services and sectors that we thought would be declared essential, and they were prioritized over others. And so I come to Spain, where Logista has more activities than in Italy. In France, we have pharmaceutical distribution, distribution to tobacconists and others that are open, while the part of Logista's distribution of publications or books, which we also have an important activity in the Spanish case, clearly these activities, not being considered essential, are doomed to temporary closure. The essential activities in these countries, let's say France, Italy, Spain, have been the same. There is a common one in what affects us. It is true that I don't know if because Italy was first, the political leaders in other countries, seeing how it went ahead, also studied what the Italian government was doing. The reality is that the services declared essential in Italy are practically the same as in Spain and France, at least in what I can confirm, which are the services and products we work with at Logista. What is there is a company, correct me if I have the wrong data, with a turnover last year above ten billion euros. Can we talk in these complicated days about objectives and economic objectives of the business plan? I think 2020 is going to be a different and difficult year. The base case we are working on is that March has been very affected in the Spanish case: three weeks, practically the whole month, and in Italy also almost two weeks. We are assuming that April will be a month where serious confinement measures will continue in those countries, as a hypothesis we take at Logista. That means that direct impact on activities will occur in the months of March and April, which are two months of the year. From there it is very difficult to see what will happen in the short term, because it is not evident for anyone. We are not making scenarios; we hope to know from the health authorities of each country from when the confinement will be lifted, which will be gradual, obviously. So I think in the short term it is difficult to make estimates. We are even incapable of having estimates of the economic damage that will be generated for the company, which will surely have damage, although as I said before we are working at about 80% right now. In the medium term, we still have our medium-term projects, and in that sense we are optimistic. We will get out of this situation. I still think of it as a short-term song. I define short term as up to three months, and from there, little by little, things will return to normal.

Well, I think at this moment dedicating ourselves to making destructive or constructive criticisms leads to little. The Spanish government or even the Italian one is going through the same thing that is happening to us as business managers: we are facing a crisis that has no precedent, and that is always the most complicated thing to manage. When you have had economic or financial crises for other reasons, you have normally gone to see what happened in the past, you could do simulations and studies to manage based on a historical record. This case is unique, it had not happened. It will be analyzed, we talk about other epidemics, but not before with the impact that COVID-19, which is so talked about now, is having. I am not one to criticize the government. I think measures are being taken with the information they have. And then we, from the business point of view, have to do the best we can; it's our job. That said, it must be recognized, and I think it is recognized by both the public and private sectors, that both in the Spanish case and also in the Italian or French case, we are having difficulties in replenishing the personal protective equipment we need. We continue working and all our workers have access to masks, gloves, and other safety measures, but it is proving especially complicated to manage right now. We are all learning a lot from this unexpected situation. One of the things we have learned is that there are recoveries in a V and in a J. To explain it a bit in everyday language, they are economic recoveries, stopped, that would be the V, and one that would be with the low part of the V. Well, do you have any perspective or any idea of how we can come out?

I think there is a scenario in which the famous curve begins to flatten and that is a good sign, and you begin to see that you can at least stop the expansive phase of the pandemic. From there, things should improve. I think if that scenario extends for two months maximum three months, I trust that we can have a rebound, like the data that China gave yesterday about the behavior of the province where the pandemic started. I think, not because I am an optimist by definition, but objectively, I think the damage is recoverable. Another thing is that it will not be the same for large well-capitalized companies with strong balance sheets as for small or medium-sized companies or self-employed people, who are having serious problems and some may have trouble reopening their business the day after. But as of today, I still think it's more of a V or between a V and a check, but not a J.

Well, I think in general we work with manufacturers. We are the distribution chain, 90 very large companies, especially in the pharmaceutical sector. There, everyone is still working with problems, but everyone is still working, and we are functioning quite well. There is a certain effect of hoarding of goods that have been considered essential, and that I think has helped a bit. But I also think that at no time has there been any risk of shortage. So I think in general the manufacturers are all well under the royal decrees in the case of Spain, Italy with its own situation, or France; we are able to work with problems, but we are able to work. Our job in this is that those products reach their destinations at the points of sale or the final consumer, in the case of hospitals and the pharmacy sector. That said, then you have another type of activity that is not... In our case, evidently, clients are very large, for example, pharmaceutical companies. So with that type of client, we are not having any problem. I think in general everyone is able to get their production out, and we distribute those products. What I was saying is that in any case, the essential sectors or those considered critical at this moment of confinement of the population, we continue working with our problems but we continue working. Another issue is that there are things like our investment plan in expansions of our logistics centers or new warehouses that we are building, which are all being affected by the stoppage, and we have had to put them on standby. But once we can, in our case, I'm sure we will resume those investment plans. Nothing will be left undone.

I think we have to draw several lessons from this crisis. It hasn't ended yet, so we continue learning from this extraordinary situation that we are living through with great difficulties. I think it will change things a bit. But also, if we look at past crises of a different nature, like the attacks on the Twin Towers in 2001 in New York or the financial crisis of 2009, the recovery capacity of humans is tremendous. We haven't forgotten the images of September 11, 2001, but at the time they were traumatic and it was also said the world would change. The world changed clearly in certain ways, more or less. I think now things will also change. At the business level, in our case, for example, it has served us to see if we were capable of teleworking. As I mentioned before, we have 1,500 people working from their homes in their usual residences, and it is working. So I think that begins to break certain paradigms. For those who had skepticism about whether teleworking could work or not, it is being proven that it works. And then there are also certain winners in this crisis: technology companies that have bet heavily on this type of audiovisual communication tools and such. I think those of us who had more or less knowledge of these tools are coming out of this with a master's degree done quickly. And that I think will help a lot. Things will change a lot.

A message of optimism for everyone. I think we will get out of this, even though we are all locked up at home and it is a very tough time personally, especially for Spaniards, who are very...