Despite a three per cent decline in revenues, The Gleaner Company Limited has reported a creditable performance for the financial year ending December 2010.
Profit before tax for the year amounted to $621 million, with a one-off gain of approximately $494 million in pension income arising from the discontinuation of the company's defined benefits pension fund.
In July of last year, the company, having received the appropriate approvals from the Financial Services Commission, discontinued its defined benefits pension fund, replacing it with a defined contribution fund. The effect of the winding-up gave rise to a one-off profit for the company and also allowed for a distribution of surplus to the fund's members.
After excluding pension income and other non-trading items, the accounts showed a slight increase in trading profit over 2009, ending the year at $211 million.
Other income increases
Revenues, at the end of 2010, totalled $3.2 billion, compared with the $3.3 billion for the corresponding period in 2009.
"This was mainly due to a reduction in advertising sales," said the company in the notes accompanying its financial report.
Other operating income reflected a $33-million increase, while finance income at the end of the year doubled to $40 million as a result of gains from investments of liquid funds arising from the sale of former subsidiary, Sangster's Book Stores in late 2009.
Distribution costs dropped to $474 million, a 12 per cent reduction, while administrative expenses were reduced by approximately $140 million, or 18 per cent, to $569 million.
The stock, which in the last couple of weeks traded among the top volume leaders, closed at a price of $2.13 on March 16, 2011.
With about 1.2 billion shares allocated, the company has a market value of $2.5 billion with assets totalling $3.6 billion, up from $3.2 billion in 2009.
In commenting on the year-end performance, Managing Director Christopher Barnes reiterated his concern about the continued depressed economic environment and attributed the year's trading performance to a focus on cost containment.
He added: "Looking forward for 2011, we hope to see some signs of economic recovery which will boost revenue, but we will nevertheless continue to concentrate on improving efficiency within the company and seeking out attractive investment opportunities for our liquid funds."