Do you guys remember, when I was encouraging you to partake? Well.... Buy more shares, says Red Stripe chairman Friday, October 31, 2014 BUY more shares, is the advice to shareholders coming from Red Stripe chairman, Richard Byles. The performance of the beer company over the last year is nothing to scoff at, he told investors at the annual general meeting, held at their Spanish Town Road Offices on Wednesday. Red Stripe returned a healthy profit of over $3.3 billion for the 2014 financial year, almost tripling the just under $1.2 billion it made last year, according to the companys audited financial statements. This, Byles said, is representative of the transformation of the companys export model into a profitable one, thus enabling them to grow the business and their profits in tough economic times. Red Stripe is currently in the take-off stage, and has positioned itself through recent efforts to modernise the plant, reduce energy consumption and substitute imported inputs with cheaper, locally sourced ones. This will result in the brewery being able to competitively produce beer alongside any other factory in the world, the chairman said. The beer company, which currently exports about five million crates annually, has projected that it will hit an export target of 20 million actual cases of Red Stripe product by the 2017 financial year. I encourage you, whatever the amount of shares you have, buy more, he told the gathering. The board, in an earlier meeting, recommended dividend payments of $0.27 cents to shareholders, amounting to just about 10 per cent of the companys profits. Asked about the possibility of a further increase on the dividend payments given the profits returned by the company, Byles said that while there could still be room for consideration of a few more cents, the company is being cautiously conservative, because of its short-term, capital-intensive investment projects. Red Stripes Managing Director, Cedric Blair, said that while the company has commendable results for the 2014 financial year, it is important that the companys investment strategy reflects their intention to generate sustainable profits for years to come. Any company can have one or two good years, but it takes a great company to have five, ten or even fifteen good years, and that is the commitment that we give to you as our shareholders, he told the audience. Continuously topping the performance of the previous year is an important objective for the company, and given the growth trajectory, you may want to check your share holdings, Blair candidly told the shareholders. As at the end of June, Byles held just under 3.5 million shares in Red Stripe, which was considerably higher than the 1.5 million shares he held at the end of 2012. Blair held 500,000 shares at the end of June, which was 200,000 more than he owned 18 months before. In May of this year, Red Stripe slashed its energy cost by just under half after firing up its new $750 million combined heat and power plant (CHP). Plans are already afoot to further cut energy cost by another 22 per cent in 18 months by converting the plant to run on cheaper liquefied natural gas (LNG), Blair told the Observer earlier this month. By January 2015, the beer company will finalise construction of its US$800,000 ($90.4 million) starch-processing plant, which will allow them to make its flagship beer with at least five per cent cassava by next March. Ultimately, the local brewer wants to replace 20 per cent of its imported barley with locally grown cassava. SHARE THIS: Share via Email Share to Facebook Share to Twitter
Posted on: Fri, 31 Oct 2014 13:14:59 +0000
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