The
GraceKennedy Group of companies recorded
an increase in sales
of $773.3 million or 5.7% moving from $13,681.2
million in 1997 to $14,454.5 million in
1998. There was a significant improvement
in our
trading profit, which rose to $766.0
million (1997 - $574.7 million), an increase
of 33.3%. This increase was a result of
our emphasis on cost reduction, increased
productivity, and improved efficiency.
Group
profit before taxation was $695.7 million
(1997 - $631.4 million), an increase of
10.2%, while
net profit attributable to stockholders
amounted to $505.8 million (1997 - $446.5
million).
Earnings per stock unit increased by
13.3% over 1997, moving from $2.47 to $2.80.
The 1997 earnings per stock unit have been
adjusted to reflect a bonus issue.
Exceptional
expenses for 1998 totaled $236.6 million
(1997: $98.0 million). These expenses
relate to expenditure incurred in the
relaunch of the Grace Brand and re-engineering
expenses in relation to GraceKennedy Limited. - Merchandise Division,
InfoGrace Ltd., Port Services Ltd., and
an associated company, Dairy Industries
(Ja.) Ltd. These expenses were necessary
to assure sustained growth in revenue
and profit. We are very optimistic that
the plans that have been implemented will
achieve the objective, in what is a very
difficult economic environment.
The
Company's price earnings ratio at the
end of the year was 7.28 compared with
the market average of 5.91.
Due
mainly to the exceptional expenses, the
Food Trading Division's contribution accounted
for -2.7% of the Group's profits for the
year. (1997: 3.1%).
The
Financial Services Division's contribution
to the Group's results increased, contributing
42.3% of the Group's profits for the year
(1997: 42.2%).
The Maritime Division has also improved
its performance and accounted for 19.4%
of the profits (1997 - 15.9%).
The
Industrial, Retail & Trading Division
increased its percentage share of the
Group's results, contributing 43.0%,
compared with 36.6% in 1997;
while the Information Division contributed
-2.0% (1997: 2.2%). The decline in
the Information Division was as a result
of a slowdown in purchases by corporate
customers and exceptional expenses associated
with measures we have taken to restructure
InfoGrace Limited so as to reduce expenses
in line with realistic achievable revenues.
Dividends
totaling $56.4 million (1997: $56.0 million)
were paid during the year. This is in
keeping with the Dividend Policy we adopted
last year, which stated our intention
to distribute at least 10% of Net Profit
Attributable to Stockholders as well as
maintain a total dividend pay out which
is at least as high in dollar terms as
it was in the previous year.
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