By McPherse Thompson, Assistant News EditorA 15 per cent increase in the revenue base of the Gleaner Group of Companies, largely attributable to upward movements in advertising sales and circulation of its newspapers, resulted in an almost 25 per cent rise in profits for the six months ended June 2003.
According to the consolidated unaudited financial report published a week ago, profit before taxation rose by $18.5 million to almost $94 million, compared with $75 million for the same period last year.
During the period, revenue increased by $143.5 million, moving from $983.3 million to just over $1.1 billion. However, distribution costs rose by about 15 per cent or $23.4 million from just over $158 million to $181.6 million; administrative expenses increased by $37.9 million or about 30 per cent from $125.8 million to $163.7 million, and other operating expenses rose 28 per cent to $172 million from $134.3 million.
Profit after tax attributable to stockholders of the parent company for the six months was $64.8 million, compared with $52.8 million or $11.9 million over the same period last year.
The Gleaner Company's chairman and managing director, Oliver Clarke, and financial director, Christopher Roberts, noted that the upward movement in profits were also attributable to exceptional gains for 2003 of $38 million as a result of the sale of investments. The comparable amount for 2002 was $1.5 million.
The directors noted that profits were also impacted by the three overseas companies - in the United States of America, Canada and the United Kingdom - which continued to incur losses as a result of their free (no cover price) publication, Extra, which targets younger Caribbean readers.
However, they said those companies were expected to return to profitability "in the foreseeable future" with increased advertising that was being generated in the publication. At the same time, the directors said the Weekly Gleaner, produced in all those overseas companies, were still popular and profitable.
SANGSTER'S BOOK STORES
According to the report, the local chain of Sangster's Book Stores, one of The Gleaner Company's 10 subsidiaries, also incurred losses during the review period due to a falling off in retail sales as a result of increases in the selling prices of books, caused primarily by the depreciation of the Jamaican dollar against the pound sterling. Comparing June 2002 with June 2003, the Jamaican dollar devalued by more than 30 per cent. There was also a falling off in sales as a result of the Government's imposition of General Consumption Tax (GCT) on books as part of the measures announced by Finance and Planning Minister, Dr. Omar Davies, during his budget presentation for the 2003/2004 financial year.
However, the directors believe that with special orders for textbooks and the removal of GCT on books and magazines, sales will pick up considerably in the second half of the year, and that Sangster's Book Stores will finish the year in a profitable position.
The Company's directors have approved a second ordinary dividend of 2.75 cents per stock unit to stockholders on record at September 1, 2003, payment for which will be made on September 12. An interim ordinary dividend of 3.5 cents per stock unit was paid on March 6 to stockholders on record at February 21, this year.
Earnings per stock unit during the period was 5.2 cents, compared with 4.4 cents during the corresponding period in 2002.
The Group accounts include The Gleaner Company's 10 subsidiaries: Associated Enterprise, Popular Printers, Sangster's Book Stores, The Book Shop, The Gleaner Online, Selecto Publications, Independent Radio Company, as well as the overseas subsidiaries, The Gleaner Company (NA) Limited, The Gleaner Company (NA) Incorporated and The Gleaner Company (UK).
