Local conglomerate Goddard Enterprises Limited (GEL) has recorded net income of $24 million for the first quarter of the current financial year, already outpacing the performance of the entire financial year ending September 30, 2021.
The multinational corporation said the income recorded for the first three months of the financial year ending December 31, 2021 was “remarkable”, given the continued impact of the COVID-19 pandemic.
For the entire year, which ended September 30, 2021, income before taxation was recorded at $29.2 million.
GEL Chairman Charles Herbert said the first-quarter results are a reflection of the recovery in the Group’s Catering and Ground Handling Division as the countries in which it operates begin to see a rebound in tourism.
“This is a remarkable performance given the impact of the ongoing pandemic on the Group’s results during the preceding 18 months. The quarter’s results are reflective of a recovery in our Catering & Ground Handling Division as the region experienced a rebound in tourism and consequently increased airlift and passenger loads,” Herbert said in the report, which was also signed by the Group’s Managing Director Anthony Ali.
“Having incurred a loss in the comparative period in the prior year, during the quarter, the Division recorded its best performance since the start of the pandemic. Despite the negative impact of the global shipping crisis on our input costs, the Group achieved a gross margin of 41.1 per cent compared with 35.7 per cent in the prior year. This was due to a change in sales mix as our Catering & Ground Handling Division, with inherently higher gross margins, accounted for a higher percentage of the Group’s revenues of $235.2 million,” said the report.
Giving an outlook, Herbert told reporters on Tuesday that he expected the record performance to continue as international travel continued to improve.
“We are very positive about the future,” said Herbert. “We anticipate a very bright future, all hoping that COVID is in fact going to continue to decline steadily.”
Herbert recalled that the company has had to undertake some restructuring, resulting in “very large” restructuring costs. Close to 2,000 employees were laid off across the 26 markets of the Group’s operations during the height of the pandemic when flights halted.
Herbert noted, however, that as airline business returned, the company has been ramping back up its staff complement.
Welcoming the continued ease in COVID-19 restrictions in Barbados and other markets, Herbert said he was very appreciative, adding that since the return of flights the airline catering business has been on a recovery path.
He was speaking to members of the media on the sidelines of a short ceremony at the Goddard’s Complex on Fontabelle, St Michael, to mark the encasement of the 100th anniversary time capsule at the location.
A total of some 33 items were encased in a blue box, which was then carefully placed in a concrete structure at the location. It is to be opened in 2046 when the company will have celebrated 125 years.
The GEL financial statement, which was recently made public, noted that the Group continued to demonstrate its resilience with its strategies for recovery and growth.
It said: “Despite the continued existence of uncertainty with the prolonged pandemic, we are confident of a full recovery for the Group this financial year, given the predictions of double-digit growth for regional economies in 2022.
“We will continue to monitor closely and put strategies in place to minimise the effects of rising geopolitical tension in Eastern Europe and the global shipping crisis on our Group’s businesses.”
The Services Division performed credibly, as expenses were well-controlled and good margins were achieved during the period.
“Our Food and Consumer Goods Joint Venture, Caribbean Distribution Partners Limited, exceeded expectations with its increase in operating profit during the quarter. This is attributable to a recovery of regional economies during the period as a result of an increase in tourism activity and its positive spin-offs across the region. Despite being faced with some logistical and raw material challenges during the period,” the report noted.
“The Manufacturing Division continues to perform well. With an increase in market share, good inventory management, and an increase in economic activity across the region, our Building Supplies Division also had a good performance during the quarter with its operating profit increasing above that of the comparative period,” it added.
The Group’s Auto Division recorded a 10 per cent decrease in its top line during the first quarter of the current financial year, while the performance of the Shipping Division during the quarter was “disappointing as the industry continues to grapple with industry and pandemic disruptions along with low sales volumes”.
Net income attributable to shareholders of $19.5 million resulted in an earnings per share for the period of 8.6 cents, representing increases above those of the comparative period of 60.1 per cent and 59.3 per cent, respectively.
The report noted that the highly contagious Omicron variant led to an increase in absenteeism across the Group. However, there were no major disruptions to the operations as a result. (MM)
