Friday, December 4, 2009

Home National Sports Business Lifestyles Religion Arts & Culture Pulse Spice Editorial letters Opinion Foodie Sportscope Real Talks Weekend Report PDF's Classifieds Contact About Us Archive Weather

City Markets' $13.4 million 2008 loss BY SCOTT ARMSTRONG ~ Guardian Business Editor ~ scott@nasguard.com: The City Market chain of supermarkets made a $13.4 million loss in 2008 the company's shareholders have been told, as it was revealed that they would be getting a dividend payout at this stage. At the annual general meeting of Bahamas Supermarkets Limited last night company chairman Basil Sands gave his shareholders a brutally breakdown of the losses and what had caused them, but also vowed that 2010 would see a better year after sweeping changing and improvements in 2009. Sands presented the AGM, held at the Old Colonial Hilton, the annual report for 2008, saying in it: "I am disappointed to report that, as foreshadowed at the last AGM, Bahamas Supermarkets Limited reported a significant loss of $13.4 million for the year ended June 20, 2008. "The reasons for the loss are many but relate substantially to inventory shortages and discounting masked by late and inaccurate management financial reports. "However, much work has been done to remedy the deficiencies and we can report that the company's key operating indicators showed significant improvement in 2009 and we are confident the worst is behind us." Shareholders were also told that most of the senior management in place in 2008 had now been replaced, including the resignation of the former Chief Executive Officer Steven Boyle. The new CEO Sunil Chatrani said: "We realize that shareholders must be concerned about the future of BSL based on its performance over the past two years and we wish to assure you that all possible steps are being taken to achieve its potential and improve its performance." The meeting was told that after last year's AGM the major shareholder - BSL Holdings Limited - had injected $10 million of additional financing. And it was revealed how since 2006 BSL's operating costs had risen $11 million, including: *Salaries increasing by $2.5 million as staff numbers increased from 750 to 850, plus increased overtime. *Utilities rising by $900,000. *Depreciation increased by $1 million due to additions at the Cable Beach store. *Legal and professional fees increased by $1.4 million due to engaging outside consultants. Sands said: "The company has completed its year ending June 2009 and has made material progress in putting 2008 behind it. "Although the unaudited accounts for the year 2009 has shown a loss, the major management and financial controls have been overhauled and are operating effectively. "Timely monthly financial reporting has been re-instituted, operating costs are being effectively controlled and systems and controls over receiving, pricing and purchasing of goods are being constantly improved. "Further, aggressive steps have been taken to curb theft and the company is confident that it is making progress in that area." Sands also paid tribute to vendors whose understanding had helped the company turn the corner. He said a key factor in the recovery of the company had been greater involvement of its operating partner Neal & Massy, an international conglomerate with assets in excess of US$1.3 billion. The shareholders were told how an executive team of experienced supermarket operators from Neal & Massy had been seconded to drive the company's recover in October 2008. The chairman thanked shareholders for their patience and "considerable tolerance" for the inadequate communication and reporting. He told his shareholders: "Despite the difficult economic environment you board remains committed to ensuring that steady progress in made towards profitability and the resumption of dividend payments." Friday December 4, 2009