Gleaner down on profit for 2011
The Gleaner Company Ltd reported a net profit of $118.5 million for 2011, a 72.5 per cent drop in bottom line from its 2010 profit which included a non-recurring $494-million income boost from the defined benefit pension fund it discontinued.
"That absence of the wind-up effect clearly drove the significant difference to the bottom line for the 2011 financial year," said The Gleaner Company's managing director, Christopher Barnes.
"Adjusting for this effect, you will see that The Gleaner Company, though down on the previous year, navigated as best as possible an economic environment that continued to be hostile to media companies," Barnes said.
Indeed, in 2011, The Gleaner's revenue, at $3.17 billion, was 0.3 per cent lower than the previous year, a decline that was offset by an equivalent drop in its cost of sales.
However, there was a 31 per cent drop, to $145.7 million, in "other operating income", which covers earnings such as from foreign-exchange gains, the sale of fixed assets and contract printing; the latter which saw inconsistent performance throughout the year.
Additionally, the company's other costs - though the four per cent hike was lower than the rate of inflation - rose by $69.54 million to $1.54 billion.
Among the biggest drivers in this increase were a seven-per-cent or $43-million rise in administrative expenses and a $29-million, or six-per-cent hike in distribution costs.
According to Barnes: "These cost increases were driven in large part by external pricing factors beyond management control such as electricity, as well as provisioning for restructuring efforts recently completed."
Increase in final income
The firm's "other operating expenses", however, declined by 1.4 per cent to $504.6 million.
Despite a $27.1-million loss from its operations, the company's bottom line was buoyed by an increase of $135 million, to $175 million, in its finance income - a rise of 340 per cent. The company posted a pre-tax profit of $160 million and net profit of $118.5 million.
"Despite the ongoing challenges, we expect this and coming years to be exciting for The Gleaner Company," said Barnes.
"We are poised to take advantage of opportunities in print, with Jamaica 50 celebrations. and the Olympics; in radio, with our soon-to-be-announced hosts and programme formats; and in our growth area, digital business, with the increasing success of our online products. Apart from the staple offering of The Gleaner and Star websites, which have delivered double-digit advertising growth, exciting products in this area include our BlackBerry news application, now with in excess of 65,000 users, and our recently launched website, www.gofirstlook.com, to name a few. Only The Gleaner can deliver the experiences of the last 50 years from its archives and blend it with content from its modern multimedia thrust to deliver the best reader and advertiser experiences Jamaica deserves in its jubilee year and beyond."