May 2011 Financial News

Lascelles profits increase by 12 per cent in Q2 but revenues flat

May 25, 2011

Local conglomerate Lascelles deMercado saw net profits increase by 12 per cent to $721.4 million over the second quarter ending March 31, 2011 compared to the corresponding period last year.

The upshot is that shareholders saw earnings per stock unit move from $6.72 at the end of March 2010 to $7.51 at the end of the period under review.

However, revenues over the period were flat at $6.4 billion compared to last year as only two — general merchandise and transportation services — out of of the group's five major segments saw revenue growth.

The conglomerate, which is a subsidiary of Trinidad and Tobago-based Angostura, offers products and services in the spirits, general merchandise, general insurance and investments and transportation industries.

The firm's general merchandise and transportation services divisions saw revenues increase by six per cent to $1.2 billion and 21 per cent to $504 million respectively. The general merchandise division includes thge manufacture, wholesale and retail merchandising of provisions, household goods and the manufacture and distribution of pharmaceutical preparations and agricultural chemicals. The transporation services segment includes aircraft handling, distribution of motor vehicles and spares, and servicing and repair of motor vehicles.

On the other hand, the firm reported a three per cent dip in revenues attributed to its flagship liquor, rums, wine and sugar division. The segment, which includes the production and distribution of liquor based products, along with cane cultivation and sugar manufacturing, posted revenues of $4 billion.

The other two major segments, general insurance and investments, saw revenue declines of seven per cent and 10 per cent respectively to $615 million and $150 million.

Despite the flat overall sales, Lascelles achieved a four per cent increase in operating profit to $676 million. Administrative, marketing and selling expenses increased by 17 per cent to $2.3 billion but the cost of operating revenue fell by nine per cent to $3.4 billion. Also, finance cost declined to $2.6 million over the period under review from $19.4 million over the corresponding period last year while finance income increased by 40 per cent to 4121 million.

The group announced last month that three Jamaican board members of the Trinidadian-acquired conglomerate were to step down: William McConnell, Anthony Bell and Jason Abrahams.

McConnell, the former managing director, has been credited with doing a fine job turning the rum division into a world-class outfit and one of the best rum producers in the region. Bell had been with the group for well over two decades, most recently in the capacity of group finance director — He joined J Wray & Nephew in 1982 and became Managing Director in 1988, moving to become Group Finance Director of Lascelles deMercado in 2002. Abrahams is a Jamaican investment banker based in Florida - he was instrumental in structuring and securing the deal that saw CL Financial subsidiary Angostura acquiring Lascelles back in 2008.

Yesterday, Lascelles' board notified the Jamaica Stock Exchange (JSE) that "consequent upon the retirement of Hon William McConnell as its managing director, which will be effective June 30, 2011, it has appointed Mr Fraser Thornton, a director of Lascelles, deMercado & Co Ltd, as managing director, effective July 1, 2011.

"Consequent upon the resignation of Mr David McConnell as Managing Director, Global Marketing Division

at J Wray & Nephew Limited, that position, as of July 1st, 2011, will be combined with that of Managing Director, Production and Agri Divisions now held by Mr Paul Henriques who will then be appointed to the new position of Managing Director, J Wray & Nephew Limited. The Board of J Wray & Nephew Limited has appointed the following new directors effective July 1, 2011: Mr. Gerald Yetming, Chairman of Lascelles, deMarcado and Co Ltd and Messrs Marlon Holder and Fraser Thornton, directors of Lascelles, deMercado & Co Ltd," added the statement to the JSE.


Source:
Jamaica Observer
Wednesday May 25, 2011

http://www.jamaicaobserver.com/business/Lascelles-profits-increase-by-12-per-cent-in-Q2-but-revenues-flat_8874897#ixzz1NNBouwu8