The novel coronavirus (COVID-19) is not just making people ill, it is now severely causing injury to some of the most prominent businesses in Barbados, as more workers are set to join thousands already on the breadline.
After signalling in his last statement to shareholders in May that difficult decisions were coming, chief executive officer of Cave Shepherd & Co. Ltd John Williams announced yesterday that the parent company, faced with mounting losses, was forced to write down almost $40 million in investments in Duty Free Caribbean Holdings (DFCH) which operates the flagship department store Cave Shepherd, Colombian Emeralds, Pages Bookstores, Jeweler’s Warehouse and Duty Free Caribbean.
Massive losses since COVID-19 hit and the local tourism sector halted, worsening already difficult times which were hangovers from the global financial crisis, Williams said the directors of Cave Shepherd & Co, had decided not to put any more money in shoring up these retail businesses operating under DFCH.
The move, Williams said, will not only reduce the Cave Shepherd Group’s 40 per cent interest in DFCH but the parent company could even take the dramatic step and pull out altogether from the operations including the Cave Shepherd Store which is more than 100 years old.
In notices published yesterday, Williams and chairman Sir Geoffrey Cave, stressed that the other businesses in the group were performing much better, while SigniaGlobe Financial and Fortress Fund Managers are expected to “generate increasing income”.
But even more important for employees of the Cave Shepherd Group and those operated by DFCH, Cave and Williams warned that despite all efforts to save jobs, an undisclosed number of workers will be let go as “this business relies on visitors to the Caribbean for 90 per cent of its revenue”.
Cave Shepherd was founded in 1906 by two businessmen from the Cave & Shepherd families establishing the main department store, now an iconic landmark on the City’s main artery, Broad Street.
The two executives in a full-page notice said: “The most difficult decisions are those that impact people, and this one in particular, being our legacy business, has been deeply felt on a personal level, as it has been for many who have been involved in this difficult process.
“The restructuring of DFCH will result in job losses and team members have been given the assurance that due process will be followed and that they will be treated with the dignity they deserve and the fairness they have come to expect.
“For those team members affected, DFCH will be offering both personal and financial counselling.”
The Cave Shepherd Group went public and listed on the Barbados Stock Exchange in 1971, and head of the Barbados Association of Corporate Shareholders Doug Skeete said the just announced plan showed the deep damage which the pandemic was inflicting to the Barbados economy.
Skeete, a principal in the accounting firm Skeete, Best & Company, said retail businesses, like those operated by Duty Free Caribbean Holdings, are going to face extremely difficult times as the tourism sector continues to struggle with very few visitors from key markets in North America and Europe.
He told Barbados TODAY: “Europe and the UK are banning tourists from the US. Our biggest market is the UK and we have to hope they get the COVID-19 situation under control so that tourists can travel here. Canada seems pretty okay, so those two countries provide some hope for us. However, the United States is still having major problems.”
