Burns Philp
p. 30 · Read in the full issue
Big lift for Burns Philp
IN a result which reflects a significant turnaround in the Fiji economy, Burns Philp (South Sea) Co Ltd has reported a record operating after-tax profit of F 54.609 million, a lift of 188 per cent on the previous year’s figure of F$ 1.597 million. Directors have recom mended a final dividend of 8.5 cents a share, plus a special dividend of 10 cents due to the group’s high liquidity. That, with the interim dividend, brings the tot al payout to shareholders for the year to 25 cents.
Group sales revenue at F 575.09 mil lion was up 17 per cent on last year. The directors announced that “this result re flects the significant turnaround in the
Fiji economy. Continuing stability under
the interim government brought a strong upsurge in consumer spending, benefitting the automotive, home centres and shipping businesses. In conjunction with the outstanding Fiji sector result,
branches outside Fiji again produced a
steady performance”.
Results in the second half of the finan cial year to June 30 were well ahead of the first six months.
The directors noted that Fiji’s eco nomy rebound was led by high sugar prices and increasing tourist numbers.
The report said all Fiji divisions and sub sidiaries of Burns Philp (South Sea) ex ceeded expectations, the higher consum er spending combining with earlier rationalisation of the Fiji businesses, Tonga, American Samoa, Western Samoa and Niue operations all produced
steady results.
The one disappointment expressed by
the directors was the Fiji’s exchange con trol restrictions prevented surplus funds from the disposal of non-strategic assets being invested at higher interest rates offshore. But the funds were used to reduce borrowings and, hence, interest expense.
The recovery of Burns Philp (South Sea) after the military coups in Fiji has been remarkable. After the first coup, the company found that trading was running at about 38 per cent of normal volume. It then climbed back to 75 per cent only to be knocked back to 40 per cent by the second coup. The company also lost much of its Indian middle man
agement through emigration.
A motor showroom in Ba and a timber yard in Lautoka were closed, while the company decided not to rebuild after a fire in Sigatoka. The company estimated the coups cost at about Asll million in book value, and staff levels fell from 842 to about 500. □