He, however, assured hundreds of appreciative shareholders at the company’s annual general meeting on Friday of its long-term viability and continued commitment to pursuing a strategy of increasing market share. This is to be achieved through the building of a distribution network that is second to none, and by aggressive marketing.

DDL (Demerara Distillers Limited) held its 51st annual general meeting at its Plantation Diamond complex, East Bank Demerara.

Persaud told shareholders they have every right to have faith in the company, since it is future-oriented and is here to stay.

He said DDL is rapidly becoming an international firm and consequently, the image of Guyana as a producer of quality products, is being enhanced globally.

As such, its strategies must reflect an accommodation with the trends of the global marketplace if it is to succeed and continue to make its contribution to the economic and social development of the people of Guyana, Persaud noted.

He said, too, that the rapid changes taking place in the world today, fuelled by the forces of globalisation, have had a significant impact on the economies of developing countries, such as Guyana, and on the way in which the developed world can be expected to respond to them.

Persaud also referred to the country’s foreign currency earnings in 2002, which totaled US$491M compared with US$573M in 1997 - a more than 14% fall in earnings in five years. This was the case despite a significantly higher volume of exports of sugar, gold and timber in 2002 than in 1997. Yet export revenue was 8% lower in 2002 against 1997, demonstrating an overwhelming dependence by the economy on commodities, the prices of which are beyond the control of producing countries like Guyana.

According to Persaud, the local market was plagued by an unprecedented crime wave, which severely affected the business community.

But he noted that success also depends on political stability, which will result in economic stability and confidence -elements necessary to attract local and foreign investments. These will create wealth and jobs to keep people in the country, thus putting a brake on the exodus of skilled professionals and business people to North America, and even motivate a return of human and capital resources.

Persaud explained that the main contributors to the reduction of DDL’s pre-tax profit was in the area of Shipping - $43M in 2002 as against $89M in 2001, and its Associated Company, BEV, which after several years of profitability, recorded a loss of $48M. The company’s share in this was $19M, resulting in a decline of $102M from what it gained from the previous year’s profit.

“In spite of the circumstances, group turnover for the year was $9Bln compared with $8Bln in 2001, an increase of 12.5%. Profit before tax, however, was $1Bln compared with $1.1Bln in the preceding year, Persaud said.

He reported: “In 2002, interest expenses increased from $203M in 2001 to $240M. The group’s borrowing is at rates that are best in the Caribbean. Group after-tax profit went down from $792M to $751M for the period.

The company paid an interim dividend of 10% in December 2002, and at Friday’s annual general meeting, directors recommended a final payment of 20%, making the total for the year 30%.

Turnover in 2002 was $7.35Bln compared with $6.19Bln in 2001, an increase of 19%. The increase was mainly in the beverage division - Pepsi, Slice, 7-Up, the Soca range of products and Diamond Mineral Water.

Persaud said the steep rise in the cost of fuel to produce steam, the escalation of electricity costs and increases in the cost of raw materials, used in the production processes, affected margins and resulted in a marginal decline in profits before tax from $873M to $863M.

He also noted that after tax profits for DDL increased from $625M to $673M as a result of additional claims for capital allowances flowing from the company’s expansion programme.

The Chairman also admitted that the beverage segment of the market is fiercely competitive. Volumes grew 27% ahead of last year’s sales, while unit costs increased due to additional cost of packaging. This resulted from the shift in consumer preference from returnable to the non-returnable form of packaging.

In terms of contribution to the community, Persaud said, “During 2002, we continued to reach out and respond to the community as a good corporate citizen”.