DESPITE recording an increase of $1.7B in profits after tax for 2016, Banks DIH Limited will have to adjust its operations and re-examine its core competencies to deal with continuing international economic uncertainty.
This is according to Managing Director Clifford Reis in the company’s 2016 annual report.
For the year at reference, it was revealed that profit after tax was $4.3B compared to $2.5B in 2015, an increase of $1.7B.

Included in this profit is a gain of $1.4B arising from the sale of its holding of ordinary shares in Banks Holdings Limited and Desnoes & Geddes (Jamaica) Limited, and the dissolution of BCL (Barbados) Limited which resulted in a surplus of $29.2M over the cost of the investment.
According to Reis, profit after tax from the company’s operating activities was $2.9B compared to $2.5B in 2015,an increase of $379M or 14.7 per cent.
He mentioned, too, that from the $4.3B profit, a dividend payment of $1.4B is proposed, leaving $2.8B for transfer to Retained Earnings.

The total shareholders’ equity amounted to $28B compared to $25B in 2015, an increase of over $3B or 11 per cent.
“These improvements were attributed to increases in revenues and physical unit sales, improvement in cost reduction and prudent management of our capital, human and financial resources,” Reis said.
But despite recording this success, Reis said that during the year, the company operated in a global environment where “sluggish economic growth” in most advanced economies continues, due in part to the decline in commodity prices and incremental increases in oil prices.

He was keen to point out, too, that the reduction in export earnings for sugar, bauxite, rice and timber has negatively affected the domestic environment.
“This, in combination with reduced public spending, caused consumer uncertainty which led to reduced demand,” Reis said.
Notwithstanding these conditions and factors, Reis was able to boast that the company rose above these challenges and achieved growth through investment in quality brands, and by strategically placing its resources against the biggest growth opportunities.
But, he said, the continuing international economic uncertainty and changing global weather patterns are projected to have negative macroeconomic consequences on the nation.

And as such, the company might very well have to make some adjustments in its operations to deal with these economic conditions.
“This will affect the way in which we manage our company in the future,” Reis said, adding:
“We have to continue to re-examine our core operational competencies; the exercise of prudent fiscal management and preparation of succession planning, to respond to the future challenges of managing our company.”
Meanwhile, the report has also revealed that revenue for Citizens Bank (Guyana) Inc, a subsidiary of Banks DIH, stood at $3.2B compared to $3.7B in 2015, a reduction of almost $500M.

Profit after tax was $479M compared to $907M in 2015, while the total asset moved from $43.1B to $50.2B, a 16.5 per cent or $7.1B increase.
However, loan assets decreased from $30.7B to $29.2B, and customers’ deposit increased from $34.9B to $42.1B.