By Al Edwards, Business Co-ordinatorLAST WEEK, the Financial Gleaner took a look at some of the leading corporate leaders in 2002 and highlighted some of the accomplishments that signified a good year for their respective companies. Today, we take a further look at some of the country's senior corporate executives that stood out last year.
ROBERT LEVY JAMAICA BROILERS
LAST YEAR saw Jamaica Broilers turn in its best performance ever, despite the fact that grains imported from the United States for use in local production have increased by 40 per cent since March last year.
According to its annual report, Jamaica Broilers saw turnover of $6.4 billion due mainly to an increase in the sales of its Best Dressed Chicken. What is remarkable is that its operating profit increased by $45 million to $85.7 million with after tax profit moving by $24.6 million to $338 million.
President and chief executive officer, Robert Levy, spearheaded a streamlining operation that saw the company move its corporate headquarters from Kingston's Hope Road to St. Catherine's McCooks Pen. The aim was to refocus on core business and to place itself closer to the centre of its operations. Mr. Levy set about tackling an $800 million debt stock by putting in place efficiencies, taking the hard decision the previous year to lay off 400 staff. He restructured the company's debt portfolio, which saw its finance cost reduced by $44 million. An encouraging indicator is that receivables grew by $667 million for the year to April or $81.3 million over the figure for the previous financial year. Mr. Levy has pointed to the improvement in the company's liquidity brought about in the main by the conversion of some of its short-term loans into longer term instruments and the paying down of overdrafts.
According to the Group's statement of cash flows, the company's long-term loans totalled almost $314.5 million at the end of the financial year. Bank overdrafts and short term loans were down to $343.1 million compared to $594.5 million during the same period the previous year.
Mr. Levy said the improvement in the debt-to-equity ratio supported the Group's plan to move aggressively towards being debt-free by the end of the 2002/2003 fiscal year and to become a net earner of cash within that time frame.
Mr. Levy said the company was also concentrating on developing its fish processing as fish was being consumed by more people globally than ever before. "Our vision for 2010 is that given the international market for fish and our experience in tilapia production... we will direct our human and financial resources to increase our sales of fish on a profitable basis to surpass that of chicken within the next five years.
HAYDEN SINGH -
COURTS JAMAICA
When Richard Coe stepped down from the helm of Courts, it was generally felt that the company has lost a great chief executive officer. He had left a big footprint, one that would prove most challenging to fill. Hayden Singh did just that, addressing what proved to be a watershed year for the furniture and electrical retail giant. Its once unassailable position was coming under threat. Added to that, falling revenues and diminishing profits painted a bleak picture. Hayden Singh showed his mettle and turned the company around in 2002, recording a good year.
Unaudited results for the six months ending September 29, 2002, shows turnover at $2.08 billion compared with 2001's $1.6 billion. Operating profit jumped to $535 million, significantly up on the previous year's $107 million. Profit after taxation came in at $440 million compared to the previous year's $299 million. Earnings per stock unit were 27.57 compared to 2001's 18.74. Last year, Courts paid a dividend of 55 cents per share with the pay out totalling $900 million. So how did Hayden Singh turn around the fortunes of Courts?
In an interview with the Financial Gleaner last year, Mr. Singh said: "Last year ending 2001, was a very difficult period for all companies in Jamaica following on the events of September 11 and the effects that it had on tourism and the entire Jamaican economy. People were very reluctant to take positions on their credit because they were not sure what their employment positions were likely to be.
"We had to re-examine the entire operations of the company and worked through our credit accounts. Our exposure to high risk credit was a problem and we worked on that to bring it back on line. We focused on making our businesses more efficient.
We closed a couple of regional warehouses, the first one was our Montego Bay premises, which was closed in January of 2001. The second one we closed was based in Mandeville, which was closed in July. We are building a new distribution centre of 100,000 square feet out in Twickenham Close, St. Catherine. It will be completed at a cost of $170 million and should be opened between February and March of this year (2003). This will allow us "just in time delivery service" going to all our branches on a daily basis.
"We also did a lot of promotions on credit because we felt that's where our opportunities lay and we promoted the credit products aggressively. We also sort to make our products more affordable for our customers which is what it is all about."
Speaking to the Financial Gleaner earlier this week, Mr. Singh said: "Last year we surpassed our expectations and we did so in a very harsh economic climate. We are very confident about the future."
DON WEHBY - GRACE,
KENNEDY AND COMPANY
When local conglomerate Grace, Kennedy and Company took the decision to bolster its financial services arm, its Chairman and Chief Executive Officer, Douglas Orane was looking for someone who could shoulder that responsibility. He turned to an energetic young man whose abilities and potential he deemed impressive. He is Don Wehby.
When Don Wehby took over Grace's Financial Services Division in 1998, it turned a profit of about $150 million, today he has increased those profits to $450 million.
Grace's Financial Services Division is divided into two entities namely banking and investment services and insurance services. Banking includes George and Branday, which is a merchant bank with assets under management of $12.5 billion. Then there is First Global Stock Brokers. In 2001, Grace bought Trafalgar Commercial Bank (TCB) and changed its name to First Global.
"When we took over TCB it made just $1 million in profit in 2000. Today (2002) it is making $122 million. For the first three months of this year we had surpassed our target for the full year. That just shows you the level of growth that is happening in the division. Our projections for First Global Stock Brokers indicate that as a new company we were breaking even in the first two months but we are now profitable and have gained market share as the number one player in the local brokerage community.
When Don Wehby took over TCB, it had about 1,500 customers; today it has 3,500. At one time, the bank managed $500 million; now it manages $7 billion. He has also managed to emphasise the importance of personalised banking, which has since been emulated by both BNS and NCB.
Today, Grace Financial Services accounts for 40 per cent of the profits for the entire group. First Global Stock Brokers ended the year as the second best performing stock broker behind Edward Gayle and Company. First Global accounts for 22 per cent of the stock broking market.
In October of last year, Grace launched the Caribbean's first US dollar fixed income fund based in the Cayman Islands. The fund is now up to US$4 million and will soon be registered both in Jamaica and in Trinidad and Tobago. The fund invests in the US dollar sovereign bonds of Jamaica, Barbados, Trinidad and Tobago, Grenada and Belize. The company offers 50 million participating shares of US$10.00 per share with the minimum initial investment requirement set at US$10,000 per investor. For each subsequent investment, the minimum is US$1,000, which can be varied at the discretion of the directors.
The objective of the Grace Fund is to provide investors with a secure investment instrument designed to yield relatively high income compared to the yield on other instruments of its kind or to the income realised on US dollar bank deposits. The Fund will achieve this goal by maintaining a diversified portfolio of investments in US dollar fixed income securities of varying maturities and risk.
What is Don Wehby's formula for success?
"I guess the formula for success in my mind is to hire the best staff. We have spent a lot of money on training our personnel. We take very seriously our investment in human capital. I have found the combination of hiring good people and paying close attention to our customers' needs a successful formula.
"One of the things I attribute to my personal success is that I surround myself with successful business people with a lot of experience. When you are young and entering the corporate world, it's easy to believe that you are on top of your game all the time."
His self appointed mentors are John Issa, Tony Lindo, Douglas Orane, Raf Diaz, Peter Moss-Solomon and Raymond Chang.
WAYNE CHEN- SUPERPLUS
Last year saw SuperPlus's chief executive officer, Wayne Chen, take on an expansion programme that saw him increasing the number of stores in the family run grocery chain. He set out to add another four stores at a cost of approximately $360 million and to double gross revenue and customer base over the next five years.
The nine-year-old company has gone from strength to strength and has spent $100 million in a new point-of-sale system for the islandwide chain having piloted the technology in its Liguanea store.
There are plans to grow SuperPlus from 23 to 40 stores in light of the local supermarket business being worth in the region of $50 billion. Wayne Chen has said that based on that estimate, using gross revenue, SuperPlus now has 11 per cent of the supermarket business.
Last year, SuperPlus opened a large store in Bouge, Montego Bay, and its store in May Pen, the largest in the chain with 30,000 square feet of retail space, which does 20,000 customer transactions every week continues to prosper.
