Chief Executive Officer’s Statement on Unaudited 1st Quarter 2008 Results
The financial results for the three months ending March 31, 2008 showed net profit of $22.1 million compared to net profit of $24.6 million for the comparative period in 2007. Sales were $1,790 million compared to $1,599 million for the comparable period last year.
The results for the quarter, though marginally below 2007 performance, reflect stability in the business and generally in the construction industry. The Retail and Agro Grace divisions showed fair performance for the period, while the Wholesale division continues to show a significant improvement in performance. Operating expenses increased disproportionately to revenue growth due in part to certain non recurring costs.
The Retail division had a fair Quarter with a same-store sales increase of 6.7% over 2007, while the division’s sales increase was only 4% due to the closure of the St. Ann’s Bay branch in March 2007. Sales were impacted by sluggish activity for construction material in certain market segments and the Easter holidays being in the first quarter of 2008.
Customer Service training continues to be an area of primary focus for the division with increased investment and periodic measurement by way of customer satisfaction surveys and mystery shopper, in order to assess overall effectiveness.
The performance of the Agricultural division was impacted by the increased fertilizer prices on the agricultural sector. The vegetable sector of the business continues to be the best performer.
The Wholesale and Projects division had good results for the Quarter. This performance is a combination of growth from existing and new market segments in the hotel industry and new housing schemes. The project sector has shown significant improvement in revenues and this is further supported by continued good results in the reseller market.
The new Information Technology system was commissioned on the 3rd of March 2008 and has delivered to expectations. It is expected that the system will enhance the efficiencies in the business particularly in the areas of procurement, distribution and control.
We wish to thank our employees, customers and other stakeholders for their continued commitment and support.
— A. Anthony Holness
