'Exceptional charges' reduce Farsons' group profit

Farsons Group made a consolidated profit after taxation and minority interest of Lm592,000, company chairman Bryan Gera told the company meeting.

In the previous financial year, it had made a consolidated profit of Lm853,000.

Reviewing the previous year's financial results during the 55th annual general meeting of Simonds Farsons Cisk plc, Mr Gera said that despite the difficult business environment in the sectors in which the group operates, it registered an improvement in its performance for the year ending January 31.

The company reported a two per cent increase in turnover, from Lm22.5 million to Lm22.9 million for the financial year. The group's profits were adversely affected by exceptional charges of Lm608,000 representing bad debts due to a closing down of two supermarket chains (Lm353,000) and by impairment of assets (Lm255,000).

The latter arose from the closure of two fast food outlets as a result of the restructuring of Food Chain (Holdings) Limited.

He said that the acquisition of the 7-Up franchise in January 2002 and the restructuring of Food Chain will help improve the operating performance of the group.

During the year, the group consolidated its property holdings under its subsidiary Trident Developments Limited. This company also acquired a further 20 per cent of the share capital of Galleria Management Limited, bringing the total shareholding in this company to 70 per cent.

The directors of Simonds Farsons Cisk p.l.c. had already declared and distributed a net interim dividend of Lm60,000 to the holders of ordinary shares.

The annual general meeting approved the directors' recommendation of the payment of a final net dividend of Lm340,000. These dividends are being paid out of tax exempt profits resulting in a total net dividend to ordinary shareholders of Lm400,000 equivalent to 1c7 per share, and maintaining the same return as the previous year.

A dividend of 6 per cent has also been paid on preference shares bringing the total amount of dividends paid to Lm580,000.

Mr Gera referred to the setting up of a group executive board. Chaired by the group's chief executive, the board is composed of Anthony J. Tabone, Paul Micallef and Ivan Faure'.

Mr Tabone, who has served the group in senior managerial posts, was appointed company secretary as from April 1.

In his address to shareholders, the group's chief executive, Louis Farrugia gave an extensive overview covering the group's business units. Highlights included Kinnie's 50th anniversary; the Pepsi Quality Award; new plant upgrades and investment; exports to various European markets, Libya and Australia; and Eco-Pure's significant improvement in sales (33 per cent) and profitability (95 per cent).

Other highlights covered Wands Limited's positive performance in the imported spirits, wines, beers and non-alcoholic beverage sectors, and the restructuring of Food Chain business.