Apr 2009 Financial News

Neal and Massy strengthens companies

Apr 23, 2009

NEAL and Massy one of this region’s leading commercial giants is looking to focus its efforts on identifying operational vulnerabilities and finding ways of strengthening its weaker areas for the coming year.

This is the strategy outlined by Chief Executive Officer, Bernard Dulal-Whiteway in his outlook for the conglomerate in the firm’s Annual report for 2008.

He said, “Strategies that will be used to strengthen weaker operations will include the deployment of experienced executives where needed, as well as the timely implementation of improvements to existing management systems”.

The CEO notes that there are some businesses that are relatively new to the Group, such as food manufacturing, airport services, tourism and insurance and they will also need to spend a great deal of time learning and integrating these new activities.

As they seek to strengthen their senior leadership team and involve more of their executives in the management of the Group’s activities, they have decided to make some further changes both to job titles as well as job responsibilities.

Additionally, Whiteway explains that the acquisition of BS&T has resulted in the broadening and deepening of the industries and markets in which the Group operates. To reflect this, the Business Unit structure was re-aligned into Lines of Business (LOBs) at the start of the 2009 financial year to optimise the Group’s resources and streamline the focus of its internal expertise.

Moreover, a number of the new additions to Neal and Massy witnessed mixed results for 2008.

The top executive highlights that S.B.I. Distribution in Barbados produced strong growth over last year. The implementation of a sophisticated warehouse management IT system has facilitated several efficiencies and this initiative, together with other changes in delivery methods, should provide further benefits. The company was appointed co-distributor for the prestigious Pfizer line of pharmaceuticals. The strengths of sister company M & D will be leveraged to further develop this aspect of its business as it seeks to become a major participant in the pharmaceutical distribution industry.

Meanwhile one of this island’s largest supermarket chains, Super Centre Limited performed satisfactorily. Dulal-Whitehead explains that the anxiety regarding escalating food costs across the world together with the Barbados Government introducing a fixed mark-up regime on a Basket of Goods provided for a difficult environment for food retailers in that country. Sales growth for the year under review was therefore moderate, but profit was increased through expanded direct purchasing and rigorous expense control.

However it is reported that Dacosta Mannings Texgas performed well. It operates within the price-control system established by the Barbados government.

The car dealership of the conglomerate in Barbados, however, had a challenging year. As noted by the CEO, Warrens Motors in Barbados experienced a difficult year. The Company made a loss for the year and efforts are being made to improve its performance.

Dacosta Mannings Automotive division represents major tyre suppliers, various “after market” consumables as well as Texaco lubricants and bulk fuels. Operating in a very competitive field this division’s performance was satisfactory.
The Knights Pharmacies chain performed well. A new location has proven to be a notable contributor. With one other outlet opened during the year, this brings the total number of outlets to eleven.

In addition it is explained by Whiteway that Roberts Manufacturing was challenged during the year with increased cost of all of its packaging and raw materials such as vegetable (trans-free) and other fats for its margarines and oils. These higher material costs coupled with the unprecedented rise in energy prices eroded gross margins as all costs could not be passed on to the consumer. Towards the end of the year, new equipment was installed which provides increased capacity, better control and improved production consistency. A comprehensive review of the Company’s product lines has been initiated.

Pinnacle Feeds experienced the further escalation of grain prices resulting primarily from the demand for grain for the production of bio-fuels. Additionally, increases in freight and soaring energy costs eroded the gross margins for the company.

Feed price increases were constrained in the face of the Barbados Government’s drive to moderate consumer prices and the ability of the farmers to absorb increases.


Source:
Stacia Browne
Barbados Advocate
Thursday April 23, 2009

http://www.barbadosadvocate.com/newsitem.asp?more=business&NewsID=3186