In the first half-year financial report since discarding its retail store operations following consecutive years of massive losses, Cave Shepherd & Co Ltd has made almost $3.5 million in profits.
The publicly-traded company, that has now centred its operations around financial services and international business, recorded a dramatic turnaround in its bottom line for the six months of 2021 ending June 30.
Compared to the same period in 2020 when the company reported a loss of $36.90 million, company chairman Sir Geoffrey Cave and chief executive officer John Williams praised the demonstrated resilience of the Barbadian company.
Cave Shepherd stores represented an iconic brand on the local business landscape and the flagship branch was a mainstay on Broad Street for more than 100 years until its operations were ravaged by the global financial crisis and then the crippling COVID-19 pandemic. The parent company decided last year to sell the retail operations which have since been rebranded Duty-Free Bridgetown.
In the directors’ report which accompanied the six-month financial statement, Sir Geoffrey and Williams said Cave Shepherd recorded profit attributable to equity holders of the company of $2.4 million, compared to a loss of $37.7 million for the same period last year.
“Shareholders will recall that at this time in the prior year, we wrote off our investment and shareholder loans of $39.6 million in Duty Free Caribbean (Holdings) Ltd (DFCH) as a result of the negative impact that the COVID-19 pandemic had on that business,” they noted.
According to the directors: “During the first half of 2021, our financial services businesses continued to perform creditably amidst the challenging economic environment from the global pandemic.
“Cave Shepherd Credit Card operations were initially impacted by COVID lockdown-related depressed economic activity, as well as disruption created by the volcanic ashfall in the earlier part of the year, but have recovered in the latter months.”
The non-bank financial services company, SigniaGlobe Financial Group, was also impacted by increased loan loss provisioning and depressed new business. Another company in the Cave Shepherd group, DGM Financial, was credited for its performance, as it faced “minimal impact” on its operations.
“Fortress Fund Managers recorded a strong performance and during the period the Group increased its shareholding from 60 per cent to 68.57 per cent. Our remaining retail associate, GCS Limited (Ganzee) is still impacted by the pandemic, but with the limited improvement in tourist arrivals, its situation is improving,” Sir Geoffrey and Williams added.
At the same time, the two directors emphasised that Cave Shepherd was cash rich and was well positioned to respond to the fluid environment.
“With our cash and liquid assets of over $52 million, our balance sheet remains solid, which means that the Group has more than sufficient resources to both support and expand the existing businesses through these difficult times while seeking out new investment opportunities as they arise,” they noted.
Cave Shepherd’s shareholders will also be benefiting from the improved performance and will receive an increased interim dividend of seven cents per share next month.