GEL shows ‘exceptional’ rebound but war a threat

The revenues of Barbadian conglomerate, Goddard Enterprises Limited, (GEL) are up more than 30 per cent for the first half of its current financial year.

Despite this “exceptional performance” the group’s chief executive officer (CEO) and board chairman are still sounding a note of caution as they monitor the impact of Russia’s invasion of Ukraine and the ongoing war there.

This was contained in the recently published half-year filing of GEL’s unaudited consolidated financial highlights. Chairman Charles Herbert and CEO Anthony Ali said the board of directors was pleased with the performance for the period ending March 31.

The group, which has interests across the Caribbean and Latin America, recorded net income of $45.3 million for the review period, which was described as “a remarkable 105.4 per cent increase over the net income earned for the entire financial year 2021 and 255.1 per cent above that earned for the comparative six-month period in the prior year”.

Ali and Herbert told shareholders: “The recovery of regional economies from a re-emergence in tourism experienced in the first quarter, was sustained into the second quarter.

“A 31.9 per cent growth in our top-line as revenues of $485.6 million were recorded and resulted in a net income attributable to equity holders of $33.5 million compared to $13.0 million in the comparative period.”

According to GEL, the effects of inflation on its input costs were negated by a change in the sales mix, as the recovery of GEL’s airline catering businesses accounted for most of revenue increases.

Offering a breakdown on the performance of various divisions within the group, the senior officials said the catering and ground handling activities exceeded the group’s expectations during the period.

They explained that pent-up demand for travel, resulted in a significant increase in airlift and passenger loads. The manufacturing division was described as the “best performing division during the pandemic” and continued to deliver on this trend “despite increased fuel, freight, and raw materials costs in all of its businesses”. According to GEL, its services division performed credibly with sales and net income both exceeding the previous comparative period.

Ali and Herbert told shareholders: “The resilience of the group has been demonstrated by the resounding recovery shown during this financial year after the devastating impact of the pandemic. The group’s diversity, the strength of its brands and the sound leadership of its Management have augured well for the group and allowed us to weather the recent storm.”

At the same time, the two officials expressed concern about the impact of the Russia-Ukraine conflict as these two countries are global suppliers of commodities such as wheat, cooking oil, and petroleum.

The conflict has resulted in global supply shortages of commodities and has caused a rise in the cost of raw materials.

“The aggravating effects of such on pre-existing inflationary pressures threaten to continue to erode some of our margins. Management intends to be proactive in its strategies and measures to be taken to mitigate against and to minimise any possible negative effects on our future performance,” they stressed.

(IMC1)