GRACE, KENNEDY & Co. l. improved its performance in all areas for the quarter ended March 31, 2004 when compared with the similar period in 2003.
The Group achieved revenues for the period of $7.3 billion (2003:$5.6 billion), an increase of $1.70 billion or 30.1 per cent. The net profit attributable to stockholders increased by $78.7 million over the corresponding period of 2003, moving from $406.4 million to $485.1 million, an increase of 19.4 per cent.
This represents earnings per stock unit of $1.50 (2003:$1.26). Significant improvement in the company's stock price was also recorded during the first quarter - the stock price of $89.01 per stock unit at the end of the quarter was a 65 per cent increase over the price at the start of the year. This trend has continued after the quarter with the trading price on May 6, 2004 being $96.00
INTERIM DIVIDEND PAYMENT
Stockholders are to benefit from an interim dividend payment to be made on May 21, 2004 of $129 million representing 40 cents per stock unit - an increase of 33 per cent over the interim dividend payment for 2003.
An exceptional performance was turned in by the Financial Services Division even as it successfully completed Phase 1 of its planned reorganisation which was the merger of its commercial bank, First Global Bank Ltd., and its merchant bank George & Branday Ltd. The new entity is First Global Bank Ltd. George & Branday Securities Ltd. was renamed First Global Financial Services Ltd. The combined banking entities had an exceptional quarter in terms of revenue and profits.
Phase 2 of the Financial Services Division reorganisation is now well underway. The main activities in this phase include: the legal merger of the non-deposit taking businesses into First Global Financial Services Limited; the creation of a financial holding company to own First Global Bank Limited and First Global Financial Services Limited; and the completion of refurbishment work at 2 St. Lucia Avenue, Kingston (the ICWI building) in preparation for our move-in date of 30 June 2004. Our target date for completion of Phase 2 is 1 July 2004.
Creditable performances were also turned in by the Food Trading Division, the Retail Trading Division and the Information Services Division.
Contributing significantly to the performance of the Food Trading Division is the continuing growth in sales of the Tropical Rhythm brand of beverages.
ACQUISITION
Acquisition of the assets of Elvico Sales Ltd, a beverage wholesaling company in Canada, has brought an additional 600 customers; it is expected, therefore, that this will greatly enhance the distribution of Grace brand products, particularly the beverages in that market.
The Retail & Trading Division showed an increase in revenues over the corresponding period in 2003.
With the completion of the physical merger of Hardware & Lumber Ltd. and Rapid & Sheffield company during the quarter, Hardware & Lumber Ltd. has begun to realise the synergies from the merger posting an excellent first quarter performance.
The Information Services Division also experienced an overall improved performance over the first quarter of 2003, reflecting the continued acceptance of its range of services. Notably, Bill Express increased its brand presence in the Caribbean, extending its service to Dominica and Barbados. Bill Express services are now available in seven Caribbean countries.
The Division's Remittance Services in Haiti, which suffered during the recent unrest has begun to bounce back quite strongly with the restoration of a more stable environment in that country.
The Grace, Kennedy Foundation annual lecture was delivered on March 23, 2004 by Dennis Morrison. Q.C. of the law firm Dunn, Cox. His discourse on the topic "The Citizen and the Law. Perspectives Old and New" was well received by the large audience.
Mr. G. Raymond Chang, Chairman of the Board of C.I. Fund Management Inc. in Canada and Mrs. M. Audrey Hinchcliffe, Chief Executive Officer of Management and Maintenance Services Ltd., Jamaica, were appointed to the Board of Directors of Grace, Kennedy & Co. Ltd. on March 17, 2004.
DEDICATED CONTRIBUTION
The Board expressed its gratitude for the dedicated contribution of Adrian Wallace, Chief Risk Management Officer when he retired at the end of April 2004 after 22 years of service.
Speaking with Wedsnesday Business yesterday, Grace's Chief Financial Officer Don Wehby said: " Grace, Kennnedy & Co. Ltd. released its first quarter results for 2004 and the segment report showed the Financial Services Division contributing $333 million or 51 per cent of the Group's pre-tax profits."
"External revenue increased by $418 million or 40 per cent to US$1.45 million compared to $1 billion for 2003 and pre-tax profits increased by $145 million or 77 per cent over 2003 when we made $188 million."
