Dec 2009 Financial News

Agostini’s profits plummet to $705,000

Dec 07, 2009

Agostini’s Ltd’s profits for the year ended September 30, 2009, plummeted to $705,000 following the company’s decision to sell the loss-making Agos Lighting. As a result, the board of Agostini’s has decided that no dividend will be paid this year. The company disposed of Agos, its subsidiary of 40 years, in September, after it suffered losses for “some time.” “The effects of that asset sale transaction, together with the year’s losses, totalled $22 million, and are reported in the income statement as “discontinued operations.” While Agostini’s Ltd’s pharmaceuticals, food/groceries distribution units did well, its housing and construction-related did not fare as well.

Agostini’s rights offering of $100 million in October 2008 following its acquisition of Hand Arnold Ltd two months earlier, coincided with the global financial crisis and was “significantly undersubscribed,” stated Agostini’s chairman, Joseph Esau. Esau did not state the extent to which the rights offering was undersubscribed. “Although this has resulted in a higher than planned debt gearing, the Agos Lighting sale has put the group in a stronger financial position, and we are pursuing other initiatives to further enhance our capital structure,” Esau stated.

Group sales and profit attributable to shareholders before the loss from the discontinued Agos Lighting operation amounted to $784 million and $23 million, compared with $547 million and $34 million in the previous year, respectively. The profit after the Agos Lighting loss was $791,000 compared to $30 million. The company said Agostini’s marketing grocery and personal care units achieved record sales. Esau said six of Agostini’s townhouse units remain unsold, but two have been leased. “Appropriate provisions have been made to reflect current market values.” “Agostini Fastening Systems, Agostini Interiors and Agostini Contracting wre challenged by the recession in the building sector,” Esau stated.


Source:
Trinidad Guardian
Monday December 7, 2009

http://guardian.co.tt/business/business/2009/12/07/agostini-s-profits-plummet-705000