JP Santos recovers from dismal 2009 to double after tax profit in 2010

A year can sometimes make the world of difference in the fortunes of a business enterprise as the recently released 2010 Annual Report of JP Santos and Company Ltd reflects.

Last year, the wholly owned subsidiary of John Fernandes Ltd more than doubled its 2009 after-tax profit, netting returns of $152.9 million compared with  $72.7 million in 2009.

The company’s significantly improved 2010 performance was due in large measure to significantly reduced taxation, which, in 2009, had slashed its overall income by around 44 per cent from $129 million in 2008, an overall comprehensive income loss of $35.1 million compared with profits of $19 million at the end of the previous year.

The company’s 2010 Annual Report indicates that it benefited from significantly reduced taxation as a result of 2 per cent minimum tax charge of $29.8 million which in effect meant that it was able to transform the 2009 $35.1 million loss to a $50.5 million gain at the end of December 2010. Last year, the financial performance of the group also benefited from a tax decrease of more than $20 million, down to $90.4 million compared with $121.7 million in 2009.

The significantly im-proved financial performance of the company last year makes good a promise made by its directors at the end of 2009 that the group’s performance would “improve significantly in 2010”.

Shareholders meeting today at the company’s 133rd Annual General Meeting will be greeted with the news of a $19 million dividend payout that will earn them an additional $1 per share, exactly what they received at the end of 2009.

Trading and rental of property comprises the main business activities of JP Santos with the company’s product distribution and retail pursuits being carried on by its wholly-owned subsidiary JPS Ltd and Bryden and Fernandes Inc in which it has a group holding of 51 per cent.

The company owns three meat centres which retail poultry products supplied by Bounty Farms Ltd, another subsidiary of John Fernandes Ltd, while another associate company, Guyana Biscuit (Holdings) pursues investments in short and long-term securities.

One of the best-known trading names in the Guyanese commercial culture, JP Santos was incorporated in 1910 and was acquired by John Fernandes Ltd in 2009.

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