In the final year of its four-year restructuring plan, Caribbean Container Inc. last year recorded an after-tax loss of $11,662,767, significantly less than the 2009 after-tax loss of $69,764,228.
According to the company’s Annual report for the year ended December 31, 2010, the company’s gross profit for last year was $144,661,971, an increase of (65.5%) over the $87,420,990 recorded the previous year. Earnings before Interest, Depreciation and Taxation in 2010 was $157,507,274, an increase of $35,617,612 (29.2 percent) over 2009 and $98,249,384 over 2008. A turnover of $887,014,849 was recorded for the year, an increase of $10,809,598 (12.9%) over 2009 when the turnover was $785,205,251. The key performance difference between the two years was the big increase in income from $91.7M in 2009 to $162.5M last year.
CCI operates a paper mill and purchases Old Corru-gated Cartons (OCC) as the main raw material for the paper making process. Last year, the OCC collected in Guyana accounted for 48% of the total OC processed into paper by the Company, the remainder was imported from Trinidad, Barbados and Suriname.
Chairman of the company Ronald Webster, in his report, noted that the company had come a far way from 2007 when it began its restructuring exercise. “At that time, liabilities exceeded total assets-shareholders equity was in deficit and the resulting negative assets value per share represented a shareholders’ liability to creditors in excess of ($2.40) for each share held,” he said. According to him, “the end result was that the shares had limited or no market value.” “Today, shareholders equity exceeds $2 billion yielding a net assets value per share of $13.20- the current market capitalization is $714.4 million at $4.70 per share, the balance sheet is strong with a debt to equity ratio of 0.20:1 net current assets are increasing and CI for the first time is in a near break even net profit position,” he said. It was stated in the financial statements that since there was no net profit, no dividend will be declared.
The company has projected that domestic sales are expected to grow by 12% and exports by 14% during the year. According to the company, Sales for January and February have exceeded the same period of 2010 by 24 percent and that they surpassed budgetary projections.
With the completion of the restructuring programme for the paper and packaging operations, Webster said that it is an ideal time for it to consider diversification opportunities. According to him, the use of land assets that are presently under-utilized so as to obtain an economic return has been identified by the company as a priority. “Work is underway on an architectural design and business plan that focus on the development of commercial and retail service properties to cater to the population boom on the East Bank Demerara, both residential and commercial and the resulting needs,” Webster stated.
The Chairman said also that the company is committed to exploring the feasibility of manufacturing and supplying recycled paper bags, both domestically and regionally.
Webster also said that this year the Guyanese economy was expected to grow at roughly the same pace as in 2010 but with a higher rate of inflation. Noting that while the mining sector will continue to support the economy it is finite, Webster said “Consequently, for the medium to longer term, major investments in other job and wealth creating activities, including scientifically managed agricultural projects, will be essential. To support this, current efforts to create a functionally literate work force need to be pursued with even greater vigor”.
Webster holds the majority interest in Technology Investments and Manage-ment Inc which presently owns Demerara Holdings Inc which holds 85.31% of the issued shares of CCI. The other substantial shareholder is Secure International Finance Co. Inc. with 5.03%.
CCI has two loans totalling $275M from Development Finance Limited of Trinidad and Tobago on its books.
The company will hold its Annual General Meeting on Friday, May 20th at the CCI Complex, Plantation Farm, East Bank Demerara.
