Apr 2011 Financial News

Witco profits up with sales drop

Apr 01, 2011

Cigarette manufacturer West Indian Tobacco Company (Witco) posted a 5.5 per cent increase in pre-tax profits despite anti-smoking legislation implemented last year.

The Champs Fleurs-based company produced a pre-tax profit of $371.9 million last year.

The recently re-elected board of directors, headed by managing director Jean-Pierre du Coudray, made the announcement at yesterday's annual general meeting at the Hyatt Regency (Trinidad) hotel in Port of Spain.

"In these circumstances, we are indeed delighted to note a 5.5 per cent increase before taxation and a growth and turnover of six per cent over 2009," he said, adding the growth was largely driven by the diversification of the company's product, which spanned both the low and high end of the spectrum.

"This strategy is clearly delivering sustained shareholder value, even in these challenging times," he said.

Amid the promising results was the fact that Witco's sales volume declined by three per cent from the last financial cycle.

Despite that decline, Witco was still able to produce a profit and pay 100 per cent of dividends to shareholders, chairman Anthony Phillip said.

"Volume is only one element; it is not the only thing driving the company," Phillip said.

Shareholders took the management team to task for several issues, including the company's pension plan and the proposed increase to directors' salaries.

Stuart Nocks, a shareholder, visited the standing microphones often and queried why the company's pension contributions rose from roughly $34 million in 2009 to over $60 million last year.

"There is nothing to be suspicious of or wary about," Phillip said.

"Everything is done according to international guidelines and standards," he noted.

Though Phillip said it would be premature to attempt to forecast the future of the tobacco company after last year's legislation change, he said the company has a "solid performance over the past ten years".

"And that performance should still continue," he said.


Source:
Renuka Singh
Trinidad Express
Friday April 1, 2011

http://www.trinidadexpress.com/business/Witco_profits_up_with_sales_drop-119037814.html