Sales up by 53%, Courts still bullish on Guyana - further expansion planned, $3.5 billion invested here to date By Miranda La Rose Stabroek News March 3, 2000 Two new stores, one at Kitty and another on the West Coast of Berbice are among Courts (Guyana) Inc's expansion and upgrading programmes for this year. The stores at New Amsterdam, Corriverton and Rose Hall are to be renovated and enlarged to provide more showroom space with a 10,000 sq ft warehouse being set up in New Amsterdam to service the Berbice branches. In addition to the main store, Courts has 11 branches at the moment. Managing Director, Errol Le Blanc spoke to reporters at a media luncheon at Le Meridien Pegasus yesterday about his company's performance since it opened its doors to business on Main Street in 1993. He announced that the popular bargain centre on Main Street, which was razed by fire in November last year, is scheduled to be completed in another two weeks. Losses in that fire were estimated at $180 million. The Bargain Centre is being rebuilt at a cost of $42 million. Le Blanc also said that recently-acquired facilities at Happy Acres on the East Coast of Demerara and the beefing up of its trucking fleet will provide for a larger inventory and ensure quicker delivery. The capital investment by Courts, he said, is directed mainly at opening new stores in heavily populated areas and improving existing ones. Last year $30 million was spent in opening new stores at Grove and Parika. The total staff now stands at 329 but when the expansion programme is completed some 70 more workers will be added. Funding is also guaranteed for training and some $12 million is to be spent in this area. Speaking about Courts' $3.5 billion investment in Guyana, Le Blanc said that it is satisfied with the return on its investment in spite of "successive years of political and industrial turmoil." Of its investment over the past six years, $2.5 billion has come from its principals overseas while the remainder was secured from the local banking system and financial markets at commercial rates of interest. Asked about financing from the National Insurance Scheme (NIS), Le Blanc said that Courts has been "taking some (flak) for borrowing from the NIS" but the company has no problems borrowing from the state agency. Monies from the NIS and local bankers, he said, are for no-risk investments. The NIS on the other hand has its responsibilities to its clients, he said, and benefits from the interest charged. He admitted that Courts had gone through a difficult period because of the political climate in the run up and for some time after the general elections but added that he is convinced "that Guyana remains very good for business." He recalled the strong reservations expressed in some quarters when Keith Coltart, the first managing director of Courts in Guyana, and himself announced their intention to open operations here. In terms of its contribution to the local economy, Le Blanc said, the staff last year alone paid $50 million in income taxes and NIS contributions amounted to $8.5 million. Duty and consumption taxes last year totalled $600 million and based on projections this year they are expected to reach $700 million. Noting that sales from 1998 had increased by 53 per cent last year, Le Blanc said that the company projects a target of $965 million in furniture sales compared to $728 million last year. He attributed the increase in sales to people being more relaxed after the political tensions which had gripped the country in 1997 and early the following year. The increased sales, he said, caught local suppliers off-guard and Courts was forced to import furniture in much larger quantities to meet local demands. He said that some 325 persons are assured of continuous employment by Courts' suppliers because of guaranteed purchases from Courts. However, he said, the shortage of working capital has been one of the bugbears facing manufacturers. In relation to this, the furniture and appliances store has initiated discussions with local banks to secure reasonable short-term working capital of up to $5 million for manufacturers to facilitate production for this year. One bank (not disclosing its name), he said, has shown an interest in the scheme. Apart from the FIND (Furniture Investment for National Development) programme which involves manufacturers, Courts has also set aside some $17 million for community activities for the year.