Third quarter corporate earnings for Barbados’ largest conglomerate, Goddard Enterprises Limited (GEL) have taken a dip, forcing the company to slash 40 per cent of employees in its catering division.
The Bridgetown-headquartered company, with operations across the Caribbean, North, Central and South America, reported a $15.3 million loss for the April to June period.
However, the company’s recently published consolidated unaudited financial highlights for the nine months ending June 30, showed net income stood at $15.38 million. This represented a massive 65.5 per cent decline from the net income recorded for the same nine months in 2019, when the group raked in $44.58 million in profit for the period.
In the board review to the financials signed by chairman Charles Herbert and chief executive officer Anthony Ali, the two noted that the third quarter “essentially coincided with the start of the period affected by the COVID-19 pandemic”.
“The impact of the pandemic varied across the group, but in aggregate resulted in a net loss for the quarter of $15.3 million which eroded just under half of the net income from the previous two quarters,” they stated.
According to Ali and Herbert, the Goddard Catering Group (GCG) took a significant hit from the halt in international travel and the company had to release about 40 per cent of the workers in that division.
“The impact was most severe in our catering group GCG which is 51 per cent owned by GEL and focuses on business within the airline industry. This industry essentially collapsed at the onset of the pandemic and is very slowly recovering. GCG has moved quickly to reorganize to a leaner management structure and staffing with more than a 40 per cent reduction in headcount,” they noted.
“Expansion of its operations not related to the airline industry, new products and alternative areas of operation are being investigated and some early successes have already been reported. The results from GCG are expected to remain negative in the fourth quarter, and to break even in the next year with profitability dependent on the progress of the pandemic and the recovery of air travel.”
They added: “Our manufacturing operations which generally focus on food products remained open throughout the shutdown period, albeit at a reduced operating level due to curfews and the requirements of physical distancing in the working environment. In aggregate, the manufacturing entities met their budgeted performance for the quarter.
“Our other operations were generally affected by shutdowns but all reopened before the end of the quarter and have returned to profitable operations. Their aggregate performance was below expectation but is expected to recover in the fourth quarter.”
The two senior Goddard executives also noted that some new opportunities have arisen from the COVID-19 pandemic and the group has “moved quickly to fill these needs”.
With an uncertain last quarter ahead, Ali and Herbert told shareholders: “The group is very conscious that the future progress of the pandemic is uncertain and may be prolonged. Our strategy is to monitor and preserve cash and to ensure that we remain robust through any eventuality. Our projections show that we can do so with confidence. However, with this in mind, the board will not be declaring an interim dividend this quarter.”