businessuite magazine special november 2011 issue

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Contents

Young Corporate JamaiCa emerges

are JamaiCan Ceo’s delivering shareholder values?

are investors getting their moneY’s Worth from high-paid Ceos?an international perspeCtive

teCh Ceos in 2011: Where are the Women?

the highlY effeCtive Ceo profile

the emergenCe of generation X Ceos in Corporate JamaiCa-Charting the suCCession plan that got them there.

Cover Story

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13 hoW JamaiCan businesses fared in 2010

top CEo’s FoR 2010JamaiCa’s

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top 20 most profitable JamaiCan Companies for 2010

top JamaiCan CompaniEs20

JamaiCa’s biggest CompanY for 2009 and 2010 is graCeKennedY


Businessuite Magazine Special Edition November 2011 2

Credits:Executive Editor: Aldo

Consultant Editor: Antonio MuirContributor: Owen Smith

Graphic Design/Layout: MD StudioPhoto credits - Sourced from the internet and contributed

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3 Businessuite Magazine Special Edition November 2011

Change is the only constant it’s said, and 2011 has turned out to be the year living up to this analogy, the old guard is making way for the new. This phenomenon is across the board, from who is leading Jamaica, with Mr. Andrew Holness taking over as the country’s youngest prime minister, to the top CEOs of corporate Jamaica in the 21st century. Ten of the top 20 CEOs belong to the Baby Boomers or the Gen X, groomed to lead traditional companies transitioning into the new century. Of these top honchos four succeeded their parents; these include Christopher Levy, Jeffrey Hall, Stephen Facey and Keith Duncan.

The others were handpicked and carefully groomed for the top spot.As corporate Jamaica is leading this change of guard, it should be pondered that apart from Anya Schnoor, Businessuite top CEO for 2008 no female made to the top 20 list, which makes us to ponder if the Jamaican corporate psyche is yet to warm up to make way for women to lead. Food for thought…As the world economies are looking for a tangible way out of crises and yet another possibility of financial meltdown across US and the EU looming on our heads, it is time that Jamaican companies take a step towards innovating and work towards powering the proverbial BRAND JAMAICA.

It is time for the young blood to assume leadership roles, not forgetting the core values and principles that have been laid out by the hard work and vision of the generation before. Technology will constantly evolve but experience is indispensible, and there is a lot to be learnt as the companies move forward. As Steve Jobs said “Innovation distinguishes between a leader and a follower”. Let’s innovate and lead.In the coming months we will examine the movement of these companies and also looking into if Jamaica is prepared to have women in leadership roles – the age of the glass ceiling is passé and as companies exhibit far-reaching reforms, this phenomenon is going to catch up sooner.As we close 2011 on a high note, on behalf of management and staff of Businessuite we wish you prosperous and productive times ahead. BM

Young Corporate JamaiCa emerges

editorial


It is repeatedly said among investment analysist that the movement in stock prices has very little to do with whom the ceo is and what they have to say. Suggesting that the ceo has very little effect on shareholder value and that the company can effectively be run by anybody and the results would not be any different. This quite frankly is not creditable and is an overly simplistic explanation for the extensive lag time is the price of company shares when a ceo is appointed or terminated and when they make strategic decisions and announcements.

Winners

Company % Open CloseBerger Paints (Jamaica) 67.50% 1.20 2.01Carreras Limited 51.54% 35.02 53.07Gleaner Company 46.55% 1.16 1.70Hardware & Lumber 32.86% 3.50 4.65Scotia DBG Investments 32.37% 16.62 22.00Pan Jamaican Investment Trust 30.58% 36.00 47.01First Jamaica Investments 30.50% 27.97 36.50Kingston Wharves 29.87% 3.08 4.00GraceKennedy Limited 25.93% 40.50 51.00Mayberry Investments Limited 24.12% 1.99 2.47Lascelles, deMercado & Co 22.00% 250.00 305.00Jamaica Broilers Group 21.17% 4.96 6.01National Commercial Bank Jamaica 20.75% 16.00 19.32Seprod Limited 16.67% 18.00 21.00Radio Jamaica 14.43% 2.01 2.30Scotia Group Jamaica 7.97% 19.57 21.13Supreme Ventures 7.96% 2.01 2.17Pan Caribbean Financial Services 7.68% 18.10 19.49Desnoes & Geddes 4.97% 3.42 3.59First Caribbean Intl Bank Jamaica 3.86% 12.70 13.19

If we accept this view then the following positive movement in stock prices had very little to do with the ceo and can therefore not be credited with this positive showing.In an article entitled, CEO Reputation: A Key Factor in Shareholder Value, written by Leslie Gaines-Ross of Burson-Marsteller, looking at the international perspective opened by saying “You need not look further than the morning newspaper or evening news to observe the tremendous influence of CEO reputations on shareholder value. Whether it is through a stock transaction, a response to a crisis, or the creation of a best-in-the-industry talent pool, a CEO’s reputation plays a significant role in determining how both internal and external audiences evaluate and ultimately respond to a company.”

Her article sought to discuss the greater impact of CEO reputation, in light of the increased expectations of stakeholders, the proliferation of communication channels, and the demand for a broader content of messages that CEOs are delivering to their constituencies. Combined, these factors are expanding the role of today’s CEO as we know it, making CEO reputation an even more critical ingredient to a company’s success.

But why do stock prices go up and down. And why is this important to investors today and in the future. When you take everything into consideration including earnings, the economy etc it all boils down to basic supply and demand. Stocks will go up when people want to buy – demand exceeding supply - and will go down when investors wants out cash in or just cash out – supply exceeding demand. This seems to be more the case in Jamaica.Occasionally the reasons for stocks going down might be because of bad news or lower than expected earnings. However if no one wants to sell the stock then the price will not go down helping to explain why stocks go down the day when there’s no news and help us understand why greed and fear play such a large role in this market. In the short term, there is no way to predict which way a particular stock will go unless we are masters of psychology and can pinpoint every shareholder’s sentiment.

THE POWER OF CEO REPUTATIONThe powerful effect of CEO reputation on the perception of a company and its bottom-line is exemplified by `Maximizing CEO Reputation’, a Burson-Marsteller

are JamaiCan Ceo’s delivering shareholder values?

performance

Continues on page 37

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CEO bonuses are up 30.5% in the last year, according to an analysis of 50 large companies published Friday in The Wall Street Journal. But how are investors to know whether they are getting their money’s worth? If a company has more than $75 million in stock market value, the Dodd-Frank Act now gives them a say on pay: Shareholders can talk about executive pay at board meetings -- big deal! Ultimately, that alleged input is toothless unless it changes compensation practices.

On a macro level, companies are doing better than they ever have: U.S. businesses posted record profits of $1.66 trillion and piled $1.9 trillion in cash onto their balance sheets in 2010. (Of course, workers are paying the price for corporate good fortune, thanks to the nation’s 8.9% unemployment rate, a 2.6% boost in productivity, and a 1.5% drop in unit labor costs.) But the ultimate measure of whether a CEO is worth the money can only be found at the level of the individual company: How much does the CEO receive compared to the shareholder value the company created during the year.

For that, let’s apply an analysis I wrote for Daily Finance’s sister site, Blogging Stocks, in

October 2006 of CEOs and their pay -- including all compensation, not just the bonuses -- that divided them into three classes:

Bargain CEOs who created shareholder value on the cheap;

Hogs who added shareholder value but got paid too much to do so; and

Value Destroyers who were paid big bucks to lose shareholder value.

The Wall Street Journal’s analysis, conducted by Hay Group, reviewed proxy statements for 50 companies with revenues of at least $4 billion. The 50 CEOs received a total of $126.1 million in 2010 bonuses, up 30.5% from their 2009 take of $83 million as their profits grew 19%.

Applying my analysis to the 12 of those 50 CEOs who were mentioned in article reveals that they got paid an average of $15.9 million while boosting their market value $2.1 billion, an average of 9.7%. Based on the change in the number of employees reported in their 10Ks, on average, these 12 companies cut jobs by 0.7% to 76,640. Of these 12, four were Bargain CEOs whose companies may be worth a look. I’d be

less inclined to put money into the four Hogs and the four Value Destroyers.

BARgAIN CEOs

Starbucks (SBUX). CEO Howard Schultz got paid $13.75 million and created $7.1 billion in market value increase (up 37.3%), a pay to market value ratio of 0.2% while cutting 5,000 jobs.

General Electric (GE). CEO Jeffrey Immelt’s pay: $21.4 million; value created: $12.4 billion (+6.5%); a pay to market value increase ratio of 0.2% with 17,000 job cuts.

Johnson Controls (JCI). CEO Stephen Roell’s pay: about $17.6 million; value created: $5.1 billion (+23.6%); a pay to market value increase ratio of 0.3% while adding 7,000 jobs.

Navistar (NAV). CEO Daniel Ustian’s pay: $10.4 million; value created: $1.6 billion (+55.2%); a pay to market value increase ratio of 0.6% while adding 800 jobs.

HOgs

Jabil Circuit (JBL). CEO Timothy Mann’s pay: $9.8 million; value created: $144 million (+5%); a pay to market value increase ratio of 5% as it cut 400 jobs.

Clorox (CLX). CEO Donald Knauss’s pay: $10.1 million; value created: $454 million (+5.1%); a pay to market value ratio of 2.2% as its job count remained unchanged at 8,300.

Walt Disney (DIS). CEO Bob Iger’s pay: $28 million; value created: $1.3 billion (+20.8%); a pay to market value ratio of 2.1% while adding 5,000 jobs; and

Jacobs Engineering (JEC). CEO Craig Martin’s pay: $6.4 million; value created: $455 million (+8.1%); a pay to market value ratio of 1.4% as it cut 400 jobs.


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Take a look at the senior management of Apple. Every senior executive is male. At IBM, it’s 10 of 12. And at Texas Instruments, it’s 3 of 12.Then consider how many technology companies have a female CEO. There’s Yahoo, of course. Xerox. Hon Hai Precision Industries, Apple’s biggest contract manufacturer. Then it gets more difficult.

Indeed, there are a number of top women executives slightly below the CEO level. Safra Catz has been one of Oracle’s presidents since 2004 and started her second stint as CFO this year. Sheryl Sandberg is COO of Facebook after being a VP at Google. Linda Sanford is a Senior VP at IBM for enterprise computing.

But why so few at the top? Given that women are more than half the population and that young women now outnumber men in graduate schools, there ought to be more. Surely, as far as consumption of technology products goes, from iPhones to Kindles, women are a huge market.

One wonders if there will be some change over the next decadein the US. Signals are mixed. But women were 50.8 percent of the U.S. population, the 2010 census reported.

For one, girls are nearly 50 percent of high school students who take the Advanced Placement exam in calculus but only 19 percent of the AP computer science test takers, the College Board reports.

But in college, something happens. By graduation, women received only 18 percent of degrees in computing and information sciences in 2009, a sharp decrease from the 37 percent in 1985, according to the National Center for Women & Information Technology.

There are similar disparities in electrical engineering, the traditional source for semiconductor and computer industry talent. Both Bill Hewlett and David Packard were electrical engineers.

Of the 407,000 members of the Institute of Electrical and Electronic Engineers (IEEE), 90 percent were male in 2010, despite years of supporting technical education for women. The IEEE also supports a Women in Engineering initiative.

Statistics also show that women engineers and technologists often leave the workforce in mid-career because they want to raise children or spend time at home. But other figures show they leave the technology sector for another. So that by the time comes for promotions, there are fewer women to choose from.

In Silicon Valley, there are many women just below the CEO’s office, like HP’s Ann Livermore, an Executive VP, who have long been regarded as potential CEOs. Livermore was twice passed over for HP CEO and now, at least is a director.

One reason why Ursula Burns was elected Xerox CEO in 2009 was that then-CEO Ann Mulcahy was afraid to lose her to another company.

Livermore has an MBA; Burns is a mechanical engineer.Then there are several stars who have either been serial successes or persistent innovators. Judith Estrin, an E.E., co-founded Bridge Networks, which helped form 3Com, then co-founded Packet Design which was bought by Cisco Systems, which made her Chief Technology Officer. Now she runs JLABS, another networking company.

Carol Bartz, now CEO at Yahoo in part because of shareholder agitation by investor Carl Icahn, is a computer scientist. After a high-paced rise at Sun Microsystems, she was recruited as CEO of Autodesk, the design-software developer. After 12 years, she stepped aside in 2006 because she didn’t want to lose her male COO, Carl Bass, to another company, she said in an interview.

Sandra Kurtzig, who founded ASK Group in 1972, is a mechanical engineer who built that company into one of Silicon Valley’s biggest mid-range computer software developers. She moved to Hawaii after selling ASK to CA Technologies in 1994. This year, she started Kenandy, another software developer, with $10.5 million from Kleiner Perkins Caufield Byers, Salesforce.com and the Wilson Sonsini law firm.

Kurtzig has said Kenandy has management software for cloud computing which may be disclosed later this year.There are also several younger CEOs, like Kim Polese, a former Sun Microsystems Java


technology



“One wonders if there will be some change over the next decade in the US. Signals are mixed.”

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Given the profound impact CEO reputation has on financial performance, possessing and communicating the qualities of a highly regarded CEO has become a top priority for companies. Boards of directors should use these qualities as a guide when selecting and developing their current, or future, CEOs. Consider using the following seven highly effective CEO qualities identified by `Maximizing CEO Reputation’ as criteria:

1: A Champion of Company Vision and ValuesSuccessful CEOs must be skilled at advocating and actually living the enterprise’s vision and values. CEO communications and behavior are what employees, share holders, analysts, customers or clients, lenders, and suppliers will use to judge the company’s viability and future performance. In a world where e-communications dominate and communications have become easier and less expensive to create, the marketplace will be ruled by CEOs who are skilled at not only identifying meaningful messages, but also determining the most effective communication channels to reach their intended audiences.

2: An Industry stand-OutToday’s scorecard economy means that CEO performance is being constantly rated and measured against the performance of others. To withstand such scrutiny and instill a sense of confidence in all stakeholders and other interested parties, CEOs must always ensure that the company is perceived positively by peers and other industry watchers. Therefore, CEOs need to present their company as the `employer of choice’, remain credible regardless of the sensitivity of a situation and be perceived as `best of their class’.

leadership

the highlY effeCtive Ceo profile

3: A skilled CommunicatorExceptional CEOs are able to communicate their vision and strategy clearly, succinctly, and consistently to both internal and external constituencies. When CEOs are adept at making strategic priorities clear inside the company, consistent external communications will follow that will accurately and coherently represent the company’s goals and direction. The era of the Narrator CEO is at hand.

4: A Master of InformationCEOs who succeed in leveraging their reputations listen carefully to both word-of-mouth and on-line talk of their companies at large and themselves. They are also familiar with the traditional and non-traditional channels that stakeholders are able to access when forming their opinions of the company and the competition.

5: A Leader of a strong Management TeamA highly valued senior management group acting and speaking in unison with the CEO is yet another leading indicator of CEO prowess. Building leadership credibility and a winning team takes more than providing stock options, granting bonuses, and modeling the values of the company.It also requires involvement by the senior management team in strategic development and implementation as well as its participation in the company’s direction all of which will translate into a stronger message delivered to external constituencies.

6: A Fast and Forward ThinkerEffective CEOs understand that the ability to foresee events and plan for change are the keys to success in today’s marketplace. They also recognize that every move they make results in a counter-move by direct and indirect competitors. Consequently, they are skilled at making decisions and taking risks in instantaneous Internet time.These CEOs are also prepared to respond to alliance opportunities and recognize the importance of being perceived as valuable alliance partners by others.

7: An Expert in Imparting KnowledgeKnowing the type of information stakeholders need and expect from the CEO and being able to deliver it personally and with confidence is the hallmark of a successful, and more importantly, credible, CEO.

All of these qualities play a significant role in producing a CEO reputation that is capable of driving a company’s performance. As a result, CEOs must be aware that they are now being evaluated by criteria extending well beyond the company’s bottom line. BM

All of these qualities play a significant role in producing a CEO reputation that is capable of driving a company’s performance. As a result, CEOs must be aware that they are now being evaluated by criteria extending well beyond the company’s bottom line.



VALUE DEsTROyERs

Whirlpool (WHR). CEO Jeff Fettig made $48.6 million while his company lost $687 million in market value, down 10% even as it added 4,000 jobs;

Monsanto (MON). CEO Hugh Grant made $13.2 million while his company lost $2.7 billion in market value, a 7% drop and cut 300 jobs;

Oshkosh (OSK). CEO Robert Bohn made $4.1 million while his company lost $600 million in market value, a 16.4% fall while adding 100 jobs; and

Beazer Homes (BZH). CEO Ian McCarthy made $6.9 million while his company lost $44 million in market value, down 12% while trimming 18 people.

In considering whether to invest in any of these companies, I would examine many other variables -- including their valuations in comparison to their growth potential. But all things being equal, I’d prefer to cast my vote on CEO pay by investing in shares of companies run by the Bargain CEOs, while shunning the Hogs and Value Destroyers.

By Peter Cohen. See full article at DailyFinance: http://srph.it/f3OkxB

developer, who founded Marimba, a software developer acquired by BMC Software. Polese started another company, SpikeSource, which was bought by Black Duck Software.

Right now, Polese, 39, a biophysicist, is serving as a fellow at Carnegie Mellon University, but probably will start another company before long.



Another younger executive is Diane Greene, 57, a mechanical engineer who co-founded VMware, the virtualization software specialist, and was CEO until 2008. Greene and her spouse, Mendel Rosenbaum, a computer scientist, got a large part of the $625 million EMC paid for VMware in 2004 and then profited when VMware went public, so chances are she will be heard from again.

To inspire and recruit women to engineering and technology, it’s probably a good thing that several of the best U.S. research universities have women presidents with science backgrounds.

Princeton has Shirley Tilghman, a molecular biologist who is also a director of Google; Massachusetts Institute of Technology has Susan Hockfield, a neuroscientist who is a director of General Electric. Rensselaer Polytechnic Institute has Shirley Ann Jackson, a physicist, who is a director of IBM and Medtronic, among others.

These academics can encourage women students as well as agitate for more women in top management. Clearly, Jackson has plenty of work to do at IBM. As does Tilghman at Google. And Hockfield at GE where one of her co-directors is Avon Products CEO Andrea Jung, an Apple director.

At Apple, Jung is the only female director. There’s a place to start.

By David Zielenziger http://www.ibtimes.com/articles/207798/20110902/technology-women-ceo-engineering-e-e-college-princeton-mit-female.htm

investing

technology

“These academics can encourage women students as well as agitate for more women in top management”

Businessuite Magazine Special Edition November 201113

the economy

Since the global economic crisis which started to unfold in late 2008, the pace of recovery in the international econo-my has been moderate. In fact for this year, the advanced economies are pro-jected to experience low to moderate growth. Significant growth is expected for emerging market economies such as China and India. It is now evident that the process of full recovery will be long and arduous.

During the period under review, Jamai-ca resumed its borrowing relationship with the International Monetary Fund (IMF). This was preceded not only by the negative impact of the global economic and financial crisis on the domestic economy, but also by a pro-longed period of low economic growth as well as a high public debt. The IMF’s

27-month Stand-By Arrangement with Jamaica, in the amount of approxi-mately US$1.27 billion, is expected to support the country’s economic re-forms. Prior to the IMF Agreement, the Jamaican Government success-fully implemented the Jamaica Debt Exchange (JDX). The intended effect of the JDX was to force interest rates down dramatically and thereby to re-duce the country’s trillion dollar debt. The support from the IMF together with the successful completion of the accompanying conditionalities, are in-tended to return the economy to a path of sustainable growth.

Apart from the reduction in interest rates, for the 2010 financial year, other positive economic indicators for the domestic economy include the mod-

eration of annual inflation rates in line with expectations, a relatively stable foreign exchange market and also an increase in the Net International Re-serves. Notwithstanding these positive indicators, the unemployment rate re-mains high at 12.4% and growth in real Gross Domestic Product continues to elude the country. Some analysts hold that it is not possible to pursue devel-opment by a focus on economic indica-tors only. Their belief is that social and economic development must comple-ment each other. For them, Jamaica cannot achieve macro-economic stabil-ity with the social structure currently in place; consequently, the country for many years has been plagued by ane-mic growth.

hoW JamaiCan businesses fared in 2010

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CEo’s FoR 2010

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Commenting on the Sagicor Group’s Operating Results for 2010 President and CEO Richard Byles (#8) offered the following analysis of his company. “Consolidated Total Revenue of $25.66 billion was 8% below that for 2009, principally due to the effect of 2009 revenue from discontinued operations – divestiture of a Cayman subsidiary, but also the impact of lower interest rates and unrealised exchange losses in 2010 and contributions from a large single premium contract in 2009. New insurance sales stayed strong across all lines of business and contributed to a healthy growth in Net Premium Revenues, when the effect of the large single premium contract in 2009 is ex-cluded. Net Investment Income in the current year was affected by lower in-terest rates but at the same time ben-efited from significant realized capital gains. Unrealized foreign exchange (FX) losses from a strengthened J$ and weaker Euro depressed the category “Fees, Commissions and Other Rev-enues”. At the same time, the Banking Group expanded its fee based revenue business.”

Bruce Bowen President and CEO in 2010, Scotia Group Jamaica Ltd. (Sco-tia Group) report to shareholders re-ported that “The Group demonstrated its resilience and commitment to our customers and shareholders as; once again, we achieved strong financial results. These were achieved despite significant challenges posed by weak loan demand, declining credit quality due to the continuing recession, rising unemployment during the year, and

lower interest rates precipitated by the Jamaica Debt Exchange (JDX) pro-gramme in February.

In his report to shareholders Chair-man and CEO Douglas Orane (He an-nounced on December 14, 2010, that Mr. Don Wehby will be appointed as Group Chief Executive Officer effective July 1, 2011, at which time he would as-sume the position of Executive Chair-man) offered that “During 2010, the world economy continued to be char-acterised by uncertainty despite signs of recovery while economic activity in the local economy remained sluggish. The GraceKennedy Group maintained focus on the needs of our customers en-abling a creditable performance, with some of our major business segments showing improved results compared to the prior year. There were, however, other business segments that had dis-appointing results. In keeping with the Group’s objective of improving returns for our shareholders, the dividends paid in 2010 were $1.35 compared to $1.15 in 2009, an increase of 17.4%. The frequency of dividend payments was also increased to three per year from the traditional two per year. Our Group Revenues for 2010 were $55.3 billion, a decrease of 3.6% when com-pared to the prior year of $57.4 billion. The Net Profit Attributable to owners of the company was $2.25 billion, rep-resenting a 12.6% decrease compared to $2.57 billion for 2009.”

Richard Byles Chairman of Desnoes and Geddes offered this explanation for the results of his company. “The

last financial year was a particularly difficult one for Desnoes and Geddes Limited due primarily to the severe economic compression of the Jamaican economy, with Gross Domestic Prod-uct falling by 1.6% in the reporting period. This contraction was a result of the global recession generally and more specifically the impact of two large consumer-focused tax pack-ages and the Jamaica Debt Exchange (estimated to have removed J$80B of purchasing power from the economy on an annualized basis). This difficult economic environment was made even worse by the discriminatory SCT re-gime, which was introduced in March 2009 and served to make our primary products less price competitive when compared with other alcohol bever-ages. This new regime is counter to what pertains in most other markets where products are taxed on their per-centage of alcohol by volume, regard-less of type or description. However, the imposed system of taxation in our market favors beverages with higher levels of alcohol content and penalizes beers and stouts with rates as much as 1,000 per cent more than tonic wine. Our net profit for the reporting period was $789 million, 49% less than the year before. Turnover of $13,332 mil-lion was a decline of 1%, the result of weaker volumes.

But what of the CEO’s who performed in this same environment and made the top 10 list. In his report to shareholder Grantley Stephenson President and CEO of Kingston Wharves Limited (KWL), pointed to improvements in

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CEo’s FoR 2010

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“Apart from the reduction in interest rates, for the 2010 financial year, other positive economic indicators for the domestic economy include the moderation of annual inflation rates in line with expectations,”

the economy


the economy

productivity as a major factor in the results achieved. “In the face of in-creases in volumes across most cargo types handled by the port, produc-tivity was successfully maintained, and in some areas exponentially improved. Twenty-foot Equivalent Units (TEUs) handled increased by 25% or 51,198 over 2009 while main-taining productivity at 21 Average Container Moves per hour in 2010.”

Stephenson also cited containment of cost as another key factor in the company performance.” In response to the rising cost for inputs such as fuel and electricity, KWL continued to enforce several measures to con-tain costs such as tighter monitor-ing of purchases and the awarding of contracts. The Company continued its conservation efforts and energy efficient practices in 2010 and will culminate in an overall energy audit in 2011 and the necessary action plan developed and implemented.”

By his own account and reports Oliver Clarke credits Christopher Barnes with the improved financial performance of The Gleaner in 2010. This performance saw a Gleaner CEO making The Top 10 List for the very first time at number 3.

After four years as deputy managing director, Christopher Barnes finally moved up and officially assumed the top job at the Company on February 1 2011, with Oliver Clarke, announcing

that he was stepping down on Janu-ary 31. Clarke, who has served as the com-pany’s managing director for 34 years, would remain chairman of the board of directors.”I will still be around and will be doing duties that Chris (Barnes) and I have agreed on,” said Clarke as he thanked the staff for their support and friendship over the years.

In his annual report to shareholders Barnes commented that, “We have closed out 2010 with much to cele-brate having been successful in keep-ing a tight rein on our costs allowing your company to report fairly good financial results boosted by pension fund related income. The profit of the Group from continuing operations for 2010 improved by over $270 Mil-lion when compared to 2009. Trad-ing profit for 2010 was $211M and showed an improvement of $3M over 2009. The company’s year-end bal-ance sheet remains strong, shows a healthy working capital base and re-mains virtually debt free. We fought to the wire with our sales efforts, which helped to partially offset ear-lier revenue shortfalls.”

Jeffrey Hall makes his very first ap-pearance on the list and also marks the first time for a Jamaica Producers CEO. Appointed Group Managing Director of Jamaica Producers Group in July 2007 after joining the Board in 2004 and joining the Group in 2002,

the appointment saw him replacing his father Dr. Marshall Hall, who has retired.

Less than four months into his ap-pointment he announced sweeping management changes at Jamaica Pro-ducers, saying it was in keeping with the turnaround plan he was guiding. “We are confident that the group has adopted the right long-term strategy for building shareholder value and that the priorities for the senior-man-agement team going forward were around effective execution of that strategy,” said Hall at the time.

Hall was on a mission to reshape Pro-ducers into a company less depend-ent on its traditional banana business and more focused on building out its processed and fresh-food segment as a growth market. Hall was taking steps to realign both businesses to-wards growth opportunities as nei-ther of them was delivering a satisfac-tory level of performance. The Serious Food Group consists of JP’s juice and smoothie, fresh desserts, soups and chilled distribution businesses in the United Kingdom. Producers Holdings is the vehicle created for JP’s farming, logistics and snack-food businesses.

William McConnell making his re-turn to The Businessuite Top 10 at number 5, following a number 1 rank-ing in 2006 and 14 for 2008 indicated in his report to shareholder that “The Group Statement of Comprehensive

top

CEo’s FoR 2010

10“We have closed out 2010 with much to celebrate having been successful in keeping a tight rein on our costs allowing your company to report fairly good financial results boosted by pension fund related income.” Christopher Barnes

Income shows that for the financial year ended September 30, 2010, the Group returned Operating Revenues of $25,974.7 million and a Profit Be-fore Tax (PBT) of $3,589.0 million. Compared to the previous year, the Group achieved both revenue growth as well as an increase in profitabil-ity. Operating Revenues increased by $1,062.4 million or 4.3% whilst PBT increased by $722.9 million or 25.2%.

But it was a series of events starting with the announcement that came on 20th May 2011 from The Board of Lascelles, deMercado & Co. Ltd an-nouncing that, consequent upon the retirement of Hon. William McCo-nnell as its Managing Director effec-tive June 30, 2011, it had appointed Mr. Fraser Thornton, a director of Lascelles, deMercado & Co Ltd., as Managing Director, effective July 1, 2011. This as we now realize was part of a master plan to reclaim the com-pany he lead for many years from the trouble it was now facing. It is argued my some that as the CEO who lead the sale of the company to the Duprey lead CL Financial Group it was his duty and responsible to bring it back from the brink of destruction and sal-vage his legacy.

Gerald Yetming, Chairman of The Board of Lascelles, deMercado & Co. Ltd is his 2010 report to shareholders sought to calm fears and doubts by making the following statement “The promise in last year’s statement that

there would be no fire sale of CL’s as-sets has been fulfilled. This remains the case. You may be assured that all decisions affecting your Group or any part of it will be taken by your Board, acting in the best interests of your Group.”On Friday July 29, 2011 the master plan began to unfold as William Mc-Connell was back in the news leading a group of investors including Pan-Ja-maican Investment Trust engineering a takeover of Lascelles deMercado, three years after a majority stake was sold to Trinidad and Tobago’s CL Fi-nancial group.

The entity to be used by McConnell for the takeover is Black Sand Acqui-sition Inc, a company registered in St Lucia and chaired by McConnell. The intrigue and chess like strategic moves now underway for what is now referred to as a hostile take over is the kind of plot and story line that movies like Wall Street and Barbar-ians at the Gate are made of.

Patrick Hylton Group President and CEO of National Commercial Bank Group – Jamaica continues to amaze and defy the odds delivering spectac-ular performances year over year. He is the only CEO to maintain a consist-ent presence on The Top 10 List since inception in 2005. His highest rank-ing been number 4 for 2006 and truly represents the essence of The List.

Hon. Michael Lee-Chin OJ Chair-man in his opening statement to shareholders says it all “I am sure I speak on your behalf when I say that our organization has demonstrated its capacity to sustain itself and to continue delivering value during a financial year when challenges were many and success was difficult. The growth in profitability could not have happened by accident; it was indeed the result of the proactive and pru-dent management of the Patrick Hyl-ton-led team, guided by the support-ive oversight of our Board. I thank the directors, executives and all other employees for their contribution to the financial year’s results.”

Donovan Perkins at PanCaribbean Financial Group makes his second appearance on the list at number 7 fol-lowing a number 8 showing in 2006. In his 2010 report to shareholders he commented that, “2010 was a year where we continued to demonstrate and build on our brand vision, to be loved by our customers...and admired by our competitors. Despite a chal-lenging market, we grew while many financial market players saw adverse operating results. For the 10th con-secutive year, PanCaribbean has re-ported record profits, one of only two companies listed on the Jamaica Stock Exchange that have achieved this remarkable and consistent per-formance over the past decade.” BM

“I am sure I speak on your behalf when I say that our organization has demonstrated its capacity to sustain itself and to continue delivering value during a financial year when challenges were many and success was difficult.” Micheal Lee Chin

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CEo’s FoR 2010

10


the economy

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BUSINESSUITE TOP TEN CEO's for 2010

2005 -2009 Top 10 Ranking Profit After Tax2005 2006 2007 2008 2009 2010 CEO 2010 2009 Change %NR 2 NR NR NR 1 Grantley Stephenson Kingston Wharves 611,610 155,080 294.38%NR NR NR NR NR 2 Christopher Barnes Gleaner Company 430,699 208,180 106.89%NR NR NR 5 NR 3 Christopher Levy Jamaica Broilers Group 1,312,801 828,063 58.54%NR NR NR NR NR 4 Jeffrey Hall Jamaica Producers Group 302,104 209,748 44.03%NR 1 NR 14 NR 5 William McConnell Lascelles deMercado & Co. Limited 3,114,189 2,559,024 21.69%10 4 9 7 9 6 Patrick Hylton National Commercial Bank Jamaica Ltd. 11,074,798 10,248,185 8.07%

NR 8 NR 13 NR 7 Donovan Perkins Pan Caribbean Financial Services 1,524,041 1,477,844 3.13%2 9 NR 6 NR 8 Richard Byles Sagicor Life Jamaica 4,871,467 4,885,565 (0.29%)

NR 5 NR 8 7 9 Bruce Bowen Scotia Group Jamaica Ltd. 10,701,767 11,605,459 (7.79%)NR NR NR NR NR 10 Keith Duncan Jamaica Money Market Brokers 986,378 1,102,622 (10.54%)

4 NR 7 NR 8 11 Stephen Facey Pan-Jamaican Investment Trust 1,244,498 1,395,677 (10.83%)NR NR 4 NR 4 12 Douglas Orane GraceKennedy Limited 2,396,256 2,722,823 (11.99%)

3 NR 8 10 13 Stephen Facey First Jamaica Investments 1,662,980 1,940,494 (14.30%)NR 3 NR 4 NR 14 Michael Bernard Carreras Limited 3,001,875 4,093,911 (26.67%)

7 7 NR 1 2 15 Anya Schnoor Scotia DBG Investments Ltd. 1,487,348 2,128,870 (30.13%)NR NR 2 3 10 16 Brian George Supreme Ventures Ltd. 421,267 751,202 (43.92%)

8 NR 3 NR 3 17 Byron Thompson Seprod Limited 830,263 1,485,937 (44.13%)NR NR NR NR 5 18 Alan Barnes Desnoes & Geddes Limited 789,398 1,551,323 (49.11%)NR 6 6 NR NR 19 Clovis Metcalfe FirstCaribbean International Bank (Jamaica) 358,664 886,658 (59.55%)

COMPANY

As can be seen from the table below we do not have a top 10, rather a top 7 as only 7 CEO’s performed at a level to secure a position on The Top 10 List. This is a first and hopefully the last time we will witness this kind of performance.

top CEo’s FoR 2010JamaiCa’s

10

Donovan Perkins makes his second appearance on the list at number 6 following a number 8 showing in 2006.

In his 2010 report to shareholders he commented that, “2010 was a year where we continued to demonstrate and build on our brand vision, “To be loved by our customers...and admired by our competitors.” Despite a challenging market, we grew while many financial market players saw adverse operating results. For the 10th consecutive year, PanCarib-bean has reported record profits, one of only two companies listed on the Jamaica Stock Exchange that have achieved this remarkable and consistent performance over the past decade.”

Passing a number of milestones along the way, he was pleased to highlight the following:• Net Income of $1.524 Billion, up 3%• Paid ordinary dividends of $604 Million or $1.10 per

share• Balance Sheet grew to $72.6 Billion, up 11%• And Stockholders’ Equity soared 34% to $10.6 Billion,

the equivalent of US$123 Million• Closed 2010 as the #1 Stockbroker with 26% market

share.• Did exceptionally well at the JSE Annual Awards, cap-

turing three coveted trophies from seven categories.• Through our largest Sigma Corporate Run ever, we

supported children with disabilities with $11.18 Mil-lion raised through the inspired involvement of 11,187 participants.

• Successfully managed the largest IPO in 2010, raising $240 Million for Dolphin Cove Limited, with subscrip-tions almost three times the amount offered.

• Received a jmA+ credit rating from CariCRIS, the fourth consecutive year the Caribbean Regions’ inde-pendent rating agency has affirmed the strength and quality of our institution. BM

Donovan PerkinsPanCaribbean Financial Group

#7


FINANCIAL DATA2010 2009

BALANCE sHEET (000)No. of Shares issued 547,924 547,924

Shareholders' Equity 10624426 7,907,817Total Assets 72647309 65,245,567Deposits 9016902 8,782,495Loans 9480319 8,653,610Investments 48552480 27,487,727Minority Interest - -

PROFIT & LOss (000)Turnover 6990632 8,871,529% incr. (decr.) over prior yr -21.20 30.18Pre-tax Profit 1975188 1,959,266% incr. (decr.) over prior yr. 0.81 6.78Aftertax Profit 1524041 1,477,844% incr. (decr.) over prior yr. 3.13 7.02Minority Interest

IMPORTANT RATIOsReturn on equity 16.45 19.72Return on Assets 2.10 2.27Deposit Growth 0.03 0.18Loan Growth 9.55 3.38Operating Profit Margin 28.25 22.08Earnings Per Share 2.78 2.70Closing Stock Price 19.49 18.10P.E. Ratio 7.01 6.70

*Restated

CORPORATE SCORE CARD

Cover story


Patrick Hylton is the only CEO to maintain a consistent pres-ence on the list since inception in 2005. His highest ranking been number 4 for 2006 and truly represents the essence of

The List.

Hon. Michael Lee-Chin OJ Chairman in his opening statement to shareholders says it all “I am sure I speak on your behalf when I say that our organization has demonstrated its capacity to sustain itself and to continue delivering value during a financial year when chal-lenges were many and success was difficult. The growth in profita-bility could not have happened by accident; it was indeed the result of the proactive and prudent management of the Patrick Hylton-led team, guided by the supportive oversight of our Board. I thank the directors, executives and all other employees for their contribution to the financial year’s results.”

Lee Chin speaking recently with Caribbean Business Report from Canada said: “Patrick Hylton is exceptionally technically gifted.

He has the ability to see around corners. He anticipated that the economy would slow down and that loan business would fall off, so what does he do? He endeavors to strengthen collection processes as to minimise loan losses. He made this move well in advance of our competitors.”

Patrick Hylton who has strategic oversight of the enterprise opera-

sPecial Feature

tion has led the organization to achieve recordgrowth in profitability. In his 2010 report to share-holders he offered to following insight into his mas-ter plan.

“Last year I indicated that we were on a mission to build our financial fortress. We strongly believe that it is in the best interest of all our stakeholders that NCB continue this process. It means we will im-prove the efficiency of how we deliver those services to your, which in turn will lower your costs.”

He added that a financial fortress like NCB afforded the opportunity to maintain and develop the capa-bilities of the largest private sector workforce in the country and provide solid returns to shareholders.

He added, the company’s financial fortress allowed to increase investment in community service activi-ties and serve as a solid source of tax solid source of tax revenues for government to support key pro-grammes.

“For the year ended September 30, 2010, we have demonstrated in many ways our desire to continue to meet the financial needs of our customers,” he in-formed.

NCB led the way to lower auto loan rates to 16.95% and were the first to introduce the 9% FARM loan to help foster growth within agricultural sector. Another key initiative was Cut Your Bank Fees campaign which helped our customers reduce and eliminate banking fees by accessing low cost bank-ing channels. Highlighting the bank’s commitment

Patrick HyltonGroup President and CEO of National Commercial Bank Group

#6

“He (Hylton) has the respect of the entire staff and has been able to congeal them as opposed to acting as a polarising agent.

special feature

towards its customers, the Money Matters campaign, offers budgeting tools and tips, saving options and debt consolida-tion.

2009 and 2010 were testing years for Jamaican financial in-stitutions who were confronted with the global recession and the Jamaica Debt Exchange (JDX). Despite these chal-lenges and obstacles for the financial year ended September 2010, NCB posted a net profit of J$11.07 billion, an increase of J$827 million or 8.1 per cent. Operating revenue came in at J$29.31 billion, increasing by 8.0 per cent or J$2.17 billion. Total assets increased by 6.3 per cent over 2009’s figure and came in at J$334.97 billion. Of note here is the increase of customer deposits, which at J$144.28 billion were 10.7 per cent higher than the figure posted in the previous year. The risk-based capital adequacy ratio improved to 16.5 per cent from 14.6 per cent. Earnings per stock unit of J$4.50 grew by J$0.34 or 8.1 per cent. Investment securities of J$200.13 billion increased by J$32.41 billion or by 19.3 per cent.

All the more remarkable was the performance of its wealth

and asset management arm, NCB Capital Markets, headed by Dennis Cohen, which contributed J$3.55 billion to the Group’s operating profits, a 55.2 per cent increase on 2009’s numbers. The Group attributes this J$1.3 billion rise in prof-its to firstly an increase in net interest income resulting from lower cost of funds and secondly non-recurrence of mark to market losses from trading activities undertaken in the prior year.

For the first quarter ended December 2010, NCB had already posted a net profit of J$3.01 billion with operating revenue increasing by 13 per cent. Net loans jumped to J$88.56 bil-lion. Retail, Corporate and Treasury reported combined op-erating results of J$2.41 billion, an increase of J$91 million over the prior year. Today NCB remains the largest commer-cial bank when measured by profit, assets, branch network and capital base.

A Past President of the Jamaica Bankers Association, Chair-man of Harmonisation Limited Hylton sits on several boards including the Caribbean Information and Credit Rating Ser-vices (CariCRIS).

“He (Hylton) has the respect of the entire staff and has been able to congeal them as opposed to acting as a polarising agent. He has managed to get the senior management team to work harmoniously and has created a great fit. The entire staff now has a pep in their step because they can see that NCB is helping to build a better Jamaica,” said Lee Chin of Hylton’s management style.

Patrick first received local and international acclaim when he was appointed to a leading role by the Government in the rehabilitation of the Jamaican financial sector during the mid 1990s. His successful completion of that undertaking culminated in the national award of the Order of Distinc-tion Commander Class. BM

Cover story


FINANCIAL DATA 2010 2009

BALANCE sHEET (000)No. of Shares issued 2,466,763 2,466,763

Shareholders' Equity 48,807,933 41,015,946Total Assets 334,970,011 315,096,477Deposits 144,283,158 130,331,351Loans & Advances 85,995,102 88,178,270Investments 201,766,996 169,113,373

PROFIT & LOss (000)Turnover 41,963,868 43,721,715% incr. over prior yr -4.02 14.17Pre-tax Profit 13,488,113 13,133,635% decr. over prior yr. 2.70 21.52Aftertax Profit/Loss 11,074,798 10,248,185% decr. over prior yr. 8.07 17.78Exceptional Item - -Extraordinary Item - -Minority Interest - -

IMPORTANT RATIOsReturn on equity 24.66 28.34Asset Growth 6.31 8.22Deposit Growth 10.70 3.36Loan Growth -2.48 7.31Loan & Investment Growth 11.84 8.10Return on Assets 3.31 3.25Operating Profit (Loss) Margin 32.14 30.04Earnings (Loss) Per Share 4.50 4.16Closing Stock Price 19.32 13.00P.E. Ratio 4.29 3.13

*Restated


Cover story


William McConnell making his return to The Busines-suite Top 10 at number 5, following a number 1 ranking in 2006 and 14 for 2008 indicated in his report to share-

holder that “The Group Statement of Comprehensive Income shows that for the financial year ended September 30, 2010, the Group re-turned Operating Revenues of $25,974.7 million and a Profit Before Tax (PBT) of $3,589.0 million. Compared to the previous year, the Group achieved both revenue growth as well as an increase in prof-itability. Operating Revenues increased by $1,062.4 million or 4.3% whilst PBT increased by $722.9 million or 25.2%.

The 4.3% growth in revenues that was mentioned above was fuelled by the Liquors, Rums, Wines & Sugar and the Transportation Ser-vices Segments. The former achieved growth of $1,312.8 million or 8.5% and the latter $435.8 million or 32.7%. Apart from these two segments, the General Insurance Segment which returned a marginal growth of 1.9% was the only other to have achieved an increase in revenues over last year. The Investments and General Merchandise Segments suffered declines over last year, of 42.6% and 8.8%, respec-tively.

For the flagship segment of the Group, Liquors, Rums, Wines & Sug-ar; although local case sales reduced by 4.3%, the sales mix and the impact of price increases taken in the prior year assisted in bolstering revenues. On the international market, we experienced significant growth of approximately 14.5% in case sales, particularly in the NAF-TA and European regions, thereby increasing revenues over last year.

The agricultural operations had a disappointing year.Following from a reduction in cane supply, the sugar production de-creased by 8%. For the Transportation Services Segment, both the Automotive Division and the cargo and aircraft handling operations of AJAS experienced increases. For the Automotive Division, in

particular, increased sales of Ford and Subaru mo-tor vehicles contributed to the overall improve-ment in new unit’s sales. For the aircraft han-dling operations, the number of flights handled increased by 20%; whilst freight movement for the year achieved an increase of 10%. Compared to last year, the General Insurance Segment expe-rienced an increase in premium income and a de-cline in its investment income, both of which are included in revenues. Of all the segments, Gen-eral Insurance was most impacted by the Jamaica Debt Exchange Programme.

Gerald Yetming, Chairman of The Board of Las-celles, deMercado & Co. Ltd in his 2010 report to shareholders sought to calm fears and doubts by making the following statement “The promise in last year’s statement that there would be no fire sale of CL’s assets has been fulfilled. This remains the case. You may be assured that all decisions af-fecting your Group or any part of it will be taken by your Board, acting in the best interests of your Group.”

By July 29, 2011 William McConnell was back in the news leading a group of investors including Pan-Jamaican Investment Trust engineering a takeover of Lascelles deMercado, three years after a majority stake was sold to Trinidad and Toba-go’s CL Financial group.

The entity to be used by McConnell for the take-over is Black Sand Acquisition Inc, a company

#5

William mcconnellManaging Director Lascelles, deMercado & Co Ltd

Cover story


registered in St Lucia and chaired by McConnell.

Outlining the rationale for the takeover, Pan Caribbean Financial Services principal broker for the take-over bid, said Lascelles is controlled by CL Spirits Limited, a sub-sidiary of the CL Financial group, a financially distressed conglomerate currently under management of the Trinidad and Tobago government and it’s Central Bank. On July 24, it said, CL Spirits defaulted on US$342 million of notes is-sued in Trinidad and Tobago and Jamaica and secured by a pledge of CL’s shares in Lascelles deMercado.

The BlackSand board said, among other things, that it was their belief that the future of Lascelles “is now in serious jeopardy and with it, the financial well-being of all of the company’s shareholders and, by extension, the CL Spirit noteholders.”

Black Sand is seeking to acquire not less than 90 per cent of the ordinary shares and all of the six per cent and 15 per cent preference shares of Lascelles deMercado.

An offer price of US$3.86, representing 9.4 per cent above the last closing price, will be made for each of the ordinary shares. Pan Caribbean pointed out that “the offer takes account of the fact that the stock price has not yet been fully adjusted from the impact of a recent special dividend of US$29 million” declared by Lascelles and payable last Wednesday, July 27.

Black Sand is offering US$0.29 and US$0.23, respectively, for the six per cent and 15 per cent cumulative preference shares.

The offer will be formally launched today and, unless ex-tended, will close on September 19, this year, subject to ex-tension in accordance with the rules of the Jamaica Stock Exchange and the Securities (Take-overs and Mergers) Regulations, 1999.

Pan Caribbean said Black Sand, an international business company, has received equity commitments from a group of sophisticated investors led by Octavian Special Master Fund, L.P. and Pan-Jamaica Investment Trust.

CL Spirits, a wholly owned subsidiary of CL Financial, was the vehicle used to acquire almost 87 per cent of the ordi-nary stock units, priced at US$9.25, and just over 97 per cent of the preference shares of Lascelles, effective July 28, 2008.

A year later, in July 2009, the Trinidad and Tobago govern-ment assumed control of Lawrence Duprey’s CL Financial under a rescue plan launched by the Central Bank.

Black Sand said it intends to stabilise the operations of Lascelles and its subsidiaries. In its consolidated unaudit-ed results for the second quarter ended March 2011, Las-celles, among whose flagship is the rum producer J. Wray and Nephew, reported a $296 million rise in net profit to $1.54 billion, a 19 per cent increase over the corresponding period last year.



Shareholders' Equity 28539529 25,185,029Long Term Liability 65956 24,833Gearing Debt 939585 724,319Current Assets 22323762 20,442,065Current Liabilities 7982928 7,731,387Minority Interest - -

PROFIT & LOss (000)Turnover 25974722 24,912,339% incr. over prior yr 4.26 8.49Pre-tax Profit 3588965 2,866,144% incr. (decr.) over prior yr. 25.22 (19.12)Aftertax Profit 3114189 2,559,024% incr.(decr.) over prior yr. 21.69 (15.13)Extraordinary item - -Minority Interest - -

IMPORTANT RATIOsDebt/Equity 0.03 0.03Current Assets Ratio 2.80 2.64Return on Equity 11.59 10.06Operating Profit Margin 13.82 11.50Earnings Per Share 32.44 26.65Closing Stock Price 305.00 280.00P.E. Ratio 9.40 10.51

*Restated


Cover story


#4

JeFFrey HallGroup Managing Director of Jamaica Producers Group

Jeffrey Hall, BA, MPP, JD, was appointed Group Man-aging Director of Jamaica Producers Group in July 2007 after joining the Group in 2002 and the Board

in 2004 and. He succeeded his father Dr. Marshall Hall, who has retired.

Less than four months into his appointment he announced sweeping management changes at Jamaica Producers, say-ing it was in keeping with the turnaround plan he was guiding. The appointments included an interim replace-ment for Andrew Lord, the head of Serious Food Company, who had resigned and Charles Czerkawski as group chief financial officer. Czerkawski held senior positions at global firms Kraft Foods, Pepsi-Cola Bottling, Gillette and Iron Mountain. Paul Samuels, the group financial controller who had replaced Peter Morris, added company secretary to his portfolio. Vince Price was brought onboard as in-terim managing director of Serious Food - now the largest operating division of the group. Hall also announced at the time that he would also be naming two new appointments to JP’s commercial divisions - the Serious Food Group and Producers Holdings - and has not ruled out promotions from within.

“We are confident that the group has adopted the right long-term strategy for building shareholder value and that the priorities for the senior-management team going for-ward were around effective execution of that strategy,” said Hall at the time.

Hall is on a mission to reshape Producers into a company less dependent on its traditional banana business and more

focused on building out its processed and fresh-food seg-ment as a growth market. Hall is also taking steps to realign both businesses towards growth opportunities as neither of them was delivering a satisfactory level of performance. The



Shareholders' Equity 4,873,385 4,531,893Long Term Liability 100,278 69,898Gearing Debt 152,603 125,817Current Assets 2,239,958 2,267,545Current Liabilities 899,565 999,326

PROFIT & LOss (000)Turnover 5,906,243 6,259,033% incr. over prior yr -5.64 71.48Pre-tax Profit 389,465 307,562% incr. (decr.) over prior yr. (26.63) 209.83Aftertax Profit 302,104 209,748% incr. (decr.) over prior yr. (44.03) 107.34Extraordinary/except. items - -Minority Interests -9,019 595

IMPORTANT RATIOsDebt/Equity Ratio 0.03 0.03Current Assets ratio 2.49 2.27Return on equity 6.42 4.81Operating Profit Margin 6.59 4.91Earnings Per Share 1.67 1.12Closing Stock Price 20.25 25.89P.E. Ratio 12.13 23.12

*Restated


(44.03)

(26.63)

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Serious Food Group consists of JP’s juice and smooth-ie, fresh desserts, soups and chilled distribution busi-nesses in the United Kingdom. Producers Holdings is the vehicle created for JP’s farming, logistics and snack-food businesses.Jamaica Producers Group Limited (JP) earned after-tax profits in 2010 of $302.1 million reflecting an in-crease of 44% relative to 2009. All business segments demonstrated improved profit performance. The JP Europe operating division accounted for 78% of the combined revenues of JP. JP Europe is the largest producer of fresh juice in the Netherlands and exports fresh juice into neighboring countries. The division also operates a UK-based logistics company serving the English-speaking Caribbean. JP Europe improved its profitability despite macroeconomic instability and increased commodity prices, particularly in the second half of the year.

Revenues declined by 6% primarily as a result of a 6% depreciation of the euro relative to the Jamaican dollar.

The JP Tropical operating division is the leading tropi-cal snack producer in the Caribbean. JP Tropical in-cludes farming, food processing and the management of land holdings and accounts for 20% of JP’s revenues. JP maintained profitability despite softening consum-er demand in Jamaica - the primary market. Through strong marketing and new product development, JP was able to achieve solid growth in their ripe banana business and tropical snack operation.

Notwithstanding this success in Jamaica, overall rev-enues declined by 2% primarily as a result of a decision to exit their export banana farming business in Hon-duras. After review, JP concluded that this business no longer met its strategic objectives and rate of return criteria.

The Corporate segment recorded a profit of $81.8 mil-lion in 2010 compared to a profit of $46.3 million for the comparable period in 2009. The company contin-ues to benefit from capital gains and controlled costs. The segment comprises interest and investment in-come net of the cost of corporate functions not directly charged to the business units.

Jeffrey Hall having made the top 10 list for the first time at #4 appears to be on the right track and his turn around and reshaping of the JP group is bearing fruit. He also serves on the JP Board’s Audit and Executive Committees. Mr. Hall is a Director of the Scotia Group Jamaica Limited, Blue Power Group Limited, Agro-In-vest Corporation and the Institute of Jamaica, Muse-ums Division. Mr. Hall received his Bachelor of Arts degree (summa cum laude) in Economics from Wash-ington University, his Masters degree in Public Policy from Harvard University and his Juris Doctorate from Harvard Law School. He has practiced law as a mem-ber of the New York Bar. BM

Cover story


For Christopher Levy 2010 represented the first full year in charge of the company as President and CEO, a position he took over from his fa-

ther Robert Levy who now holds the postion of Group Chairman.

If the results are anything to go by then Christopher is off to a good start. Robert Levy who only appeared once on The Businessuite top CEO 10 list made his first en-try at number 5 in 2008, Christopher in his first year in charge made the list at number 3 with a 58.54% per-cent growth in 2010 over 2009. In commenting on the performance Christopher said, “ As we unveil details of the performance of the Jamaica Broilers Group for the 2009/2010 operating year, we can report, yet again, that our Group has recorded our best ever performance. The “best ever” was bold and highlighted in the report to draw attention and emphasis to the performance.

He went on the say that “This is a highly commendable achievement, given the radical changes that have taken place over the years in both the Jamaican and the global operating environments. We believe that the sustained and outstanding performances are a result of the culture of excellence that exists at Jamaica Broilers, twinned with dedicated and astute management, team work and an enduring reliance on God’s direction.In his report to shareholders Christopher Levy com-mented that “In a year of unparalleled economic turmoil across the globe, very few companies have been fortu-nate enough to have recorded their very best year ever. Jamaica Broilers Group is numbered among the few that can claim that honor and we can only recognize and thank God for the guidance and direction given to us as directors, management and employees, so that we were able to accomplish this. During the year under review, turnover decreased by 8.84% – moving down $2.176 bil-

cHristoPHer levyManaging Director of Jamaica Broilers Group

#3

lion from the $24.623 billion recorded in 2008/2009 to $22.447 billion in 2009/2010.”

“However, gross profits increased by 19% from $3.961 billion the previous year to $4.716 billion during 2009/2010; net profit attributable to stockholders grew 59% from the $828 million realized in 2008/2009 to $1.313 billion in 2009/2010. The reduc-tion in turnover resulted from a strategic change in our ethanol business, which saw us moving into 2-year contractual process-ing or “tolling” arrangements, which allow us to process and de-liver ethanol on behalf of clients, instead of selling the finished product directly into the USA marketplace on our own account. The Group is in the second year of this revised business strategy which has paid off handsomely for our ethanol operations.” BM



Shareholders' Equity 6,883,631 5,797,711Long Term Liability 1,717,023 1,670,410Gearing Debt 3,960,217 5,478,005Current Assets 6,077,266 6,389,816Current Liabilities 3,856,176 5,619,251Minority Interest - -

PROFIT & LOss (000)Turnover 22,446,902 24,623,315% incr. over prior yr -8.84 20.44Pre-tax Profit 1,597,237 1,003,727% incr. over prior yr. 59.13 11.09Aftertax Profit 1,312,801 828,063% incr. (decr.) over prior yr. 58.54 11.85Exceptional Items - -Extraordinary Items 0 0


*Restated


Cover story


By his own account and reports Oliver Clarke credits Christopher Barnes with the improved financial perfor-mance of The Gleaner in 2010. This performance saw the

Gleaner CEO making The Top 10 List for the very first time at number 2.

After four years as deputy managing director, Christopher Barnes finally assumed the top job at the Company on February 1, 2011, with Oliver Clarke, announcing that he was stepping down on January 31. Clarke, who has served as the company’s managing director for 34 years, would remain chairman of the board of directors.

“I will still be around and will be doing duties that Chris (Barnes) and I have agreed on,” said Clarke as he thanked the staff for their support over the years.

In his annual report to shareholders Barnes commented that, “We have closed out 2010 with much to celebrate having been successful in keeping a tight rein on our costs allowing your company to report fairly good financial results boosted by pen-sion fund related income. The profit of the Group from continu-ing operations for 2010 improved by over $270 million, com-pared to 2009. Trading profit for 2010 was $211m and showed an improvement of $3M over 2009. The company’s year-end balance sheet remains strong, shows a healthy working capi-tal base and remains virtually debt free. We fought to the wire with our sales efforts, which helped to partially offset earlier revenue shortfalls.”Barnes, a graduate of Boston University in the United States and McGill University in Canada, joined The Gleaner in 2007 after leaving Alcan in New Jersey. The Campion College gradu-ate quickly established himself as part of The Gleaner’s man-agement team, leading the changes necessary to tighten the

#2cHristoPHer BarnesCEO Jamaica Gleaner Company



Shareholders' Equity 2,456,955 2,023,168Long Term Liability 40,534 40,105Gearing Debt 56,236 63,062Current Assets 2,430,960 1,281,709Current Liabilities 497,681 678,514

PROFIT & LOss (000)Turnover 3,187,725 3,274,179% incr. over prior yr (2.64) 0.86Pre-tax Profit 620,535 1,822% incr. (decr.) over prior yr. 33957.90 100.40Aftertax Profit 430,699 208,180% incr. (decr.) over prior yr. 106.89 146.81Exceptional Items


*Restated



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company’s operating practices.

“I’m not daunted,” Barnes said as he prepared to take over the leadership of one of the oldest newspaper in the Western hemisphere. “I know it is a serious chal-lenge, but I’m pretty confident in my ability to over-come challenges,” he added.

Barnes informed that while there would be no major changes at The Gleaner immediately after he assumes office, but he is going to implement programmes aimed at improving the operations and achieving growth would continue.

“The Gleaner is not going to change overnight with my appointment. We have been evolving over the years, and we will continue to evolve to respond to the needs of advertisers and readers,” he said.

With a commitment to continuing The Gleaner’s high standard of delivering value to its shareholders and customers, Barnes is clear on where the company needs to go.

“The objective has to be growth. You can’t cost cut your way to growth, so what we have to do is look at new and innovative ways of keeping the public in-formed but always looking to doing it in a commer-cially sound way. In other words, we need to be able to make money to continue to support the overheads that we use to collate and disseminate the news,” Barnes said.

He noted that The Gleaner already has an excellent online product and that development would contin-ue.

“It is an evolving technology and the world is still un-clear of how you are going to make money, but we

have seen some advertising growth due to the take-up of Internet in Jamaica and we are encouraged by it.”

Looking forward Barnes told shareholder that, “2011 will bring much opportunity for The Gleaner Com-pany, however, with equal or greater challenge.”

“The team will have to pull together to dig deeper than it has before to produce the much improved results which our shareholders expect. We must continue to embrace change and adapt accordingly. It will be important to focus on our core operation’s performance which is of pivotal importance. We must undertake a careful review of our processes to eliminate waste and work with passion to improve efficiency. We will need to prospect for new sources of revenue, employ out-of-the-box thinking, display more initiative, and go the extra mile to deliver what our stakeholders (readers, advertisers, community, and the country at large) expect of us. We will con-tinue to provide the ultimate customer service ex-perience. Editorially, we will reinforce our market leadership position; promote literacy/education, job creation, crime reduction and the espousal of good family values. Finally, we need to continue to keep our government transparent and hold it to its prom-ises in the preservation of our democracy; the main objective of a free press.”

Established in 1834 by the deCordova brothers (Josh-ua and Jacob), The Gleaner is a staple of Jamaican life and Barnes by his own account affirmed that he is committed to continuing and building on this his-torical institution’s reputation for excellence. BM

“The objective has to be growth. You can’t cost cut your way to growth, so what we have to do is look at new and innovative ways of keeping the public informed but always looking to doing it in a commercially sound way.” Christopher Barnes


Grantley stePHenson President and CEO of Kingston Wharves Limited (KWL)

#1

The best way to understand how the Grantley Stephenson lead Kingston Wharves Limited (KWL), was able to produce the results achieved -294.38% is to go to the company’s 2010 an-

nual report and review and the reports of Derek Jones, Chairman of the Company. Stephenson himself suggests that the results of the past year are a fulfillment of the commitment made in 2008 to prepare the KWL Group to effectively manage the challenges as a consequence of the recession and to put the Group on a path of sustainable growth.

According to Derek Jones “KWL like its counterparts in the global shipping industry, has been challenged by the recession over the last two years. The Group, however, has continued along the path that it proactively took to implement strategies to enable it to emerge strong-er from the recessionary period. Our performance in 2010 validates this decision.”

Looking at the broader picture, Jones said “The global shipping in-dustry has rebounded strongly from the worst downturn in history in 2009 as the recession hit global trade and forced many companies to

lay up ships and cut jobs. At the height of this recession, world seaborne trade (goods loaded) decreased by 4.5% to 7.94 billion tons. Ship-ping is at the receiving end of market volatility and the industry is seen as a key indicator of global and national economic well being.”

In his report to the shareholders Grantley Stephenson pointed out the improvements in productivity as a major factor in the results achieved. “In the face of increases in volumes across most cargo types handled by the port, productivity was successfully maintained, and in some areas exponentially improved. Twen-ty-foot Equivalent Units (TEUs) handled in-creased by 25% or 51,198 over 2009 while main-taining productivity at 21 Average Container Moves per hour in 2010.”

Stephenson also cited containment of cost as another key factor in the company perfor-mance. “In response to the rising cost for inputs such as fuel and electricity, KWL continued to enforce several measures to contain costs such as tighter monitoring of purchases and the awarding of contracts. The Company contin-ued its conservation efforts and energy efficient practices in 2010 and will culminate in an over-all energy audit in 2011 and the necessary action plan developed and implemented.”

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In his report to shareholders Grantley Stephenson pointed to improvements in productivity as a major factor in the re-sults achieved.

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Derek Jones also cited the April 2011 issue of the Business Monitor International – Latin America Report which predicts that Jamaica will emerge from the recession this year, al-though real GDP growth is likely to remain subdued at just 1.5% in 2011 and 1.4% in 2012, from a 1.2% contraction in 2010.

The report further said that in real terms the economy will be about the same size it was in 2005. The effect of measures instituted in 2010 to address deep fiscal imbalances in the Jamaican economy, such as tax measures, the debt exchange initiative, the engagement of the IMF standby arrangement and the Government’s fiscal responsibility, should continue to positively impact the fortunes of the domestic currency in 2011. However, uncertainty about the Jamaican economy, es-pecially the potential effect on business, will prevail.”BM



Shareholders' Equity 7908397 7,434,373Long Term Liability 2003744 2,576,003Gearing Debt 2462422 3,007,277Current Assets 1807071 1,618,065Current Liabilities 894285 721,844

PROFIT & LOss (000)Turnover 3025883 2,570,325% incr. over prior yr 17.72 (5.09)Pre-tax Profit 887281 196,035% incr. over prior yr. 352.61 (9.86)Aftertax Profit 611610 155,080% incr. over prior yr. 294.38 (6.57)Exceptional itemsExtraordinary

IMPORTANT RATIOsDebt/Equity Ratio 0.31 0.40Current Assets Ratio 2.02 2.24Return on Equity 7.97 2.11Operating Profit Margin 0.29 0.08Earnings Per Share 0.56 0.14Closing Stock Price 4.00 3.08P.E. Ratio 7.14 22.00


BUSINESSUITE TOP 20 LARGEST COMPANIES

COMPANY Turnover2010 2009 Change %

1 GraceKennedy Limited 55,318,408 57,406,415 (3.64%)2 National Commercial Bank Jamaica Ltd. 41,963,868 43,721,715 (4.02%)3 Scotia Group Jamaica Ltd. 40,584,946 47,160,703 (13.94%)4 Lascelles deMercado & Co. Limited 25,974,722 24,912,339 4.26%5 Sagicor Life Jamaica 25,657,022 27,872,526 (7.95%)6 Supreme Ventures Ltd. 25,419,264 28,167,960 (9.76%)7 Jamaica Broilers Group 22,446,902 24,623,315 (8.84%)8 Cable & Wireless (Jamaica) Ltd. 16,942,218 16,370,138 3.49%9 Jamaica Money Market Brokers 14,695,243 15,969,623 (7.98%)

10 Desnoes & Geddes Limited 13,332,436 13,447,889 (0.86%)11 Carreras Limited 10,410,178 10,923,530 (4.70%)12 Seprod Limited 9,776,563 9,495,060 2.96%13 Caribbean Cement Company 7,929,783 8,869,260 (10.59%)14 Pan Caribbean Financial Services 6,990,632 8,871,529 (21.20%)15 Jamaica Producers Group 5,906,243 6,259,033 (5.64%)16 Hardware & Lumber Ltd 5,728,987 5,940,599 (3.56%)17 FirstCaribbean International Bank (Jamaica)5,346,982 6,276,755 (14.81%)18 Gleaner Company 3,187,725 3,274,179 (2.64%)19 Kingston Wharves 3,025,883 2,570,325 17.72%20 Capital & Credit Financial Group 2,826,333 4,161,653 (32.09%)21 Scotia DBG Investments Ltd. 2,408,850 3,796,568 (36.55%)

22 Mayberry Investments Ltd. 2,121,896 2,283,893 (7.09%)23 Radio Jamaica Ltd 1,995,765 1,606,553 24.23%24 Pulse Investments Limited 1,586,281 1,554,791 2.03%25 Pan-Jamaican Investment Trust 1,492,945 1,736,014 (14.00%)26 First Jamaica Investments 1,455,570 1,635,592 (11.01%)27 Pegasus Hotels of Jamaica 965,977 1,002,775 (3.67%)28 Dolphin Cove Limited 879,639 832,639 5.64%29 Jamaica Livestock Association 752,619 904,493 (16.79%)30 Blue Power Group Limited 696,456 647,744 7.52%31 Palace Amusement Ltd 675,638 528,906 27.74%

32 Jamaican Teas Limited 451,512 320,131 41.04%33 Salada Foods Jamaica Limited 426,375 432,425 (1.40%)34 Access Financial Services Ltd. 382,869 299,284 27.93%35 Montego Bay Freeport 168,438 423,858 (60.26%)36 Cargo Handlers Limited 165,208 173,697 (4.89%)37 Montego Bay Ice Co. Limited 33,618 33,782 (0.49%)

Total 262,841,718 283,379,561 (7.25%)

CompaniEsJamaiCanLaRgEst

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top 20 Companies


In compiling this list the following were taken into consideration. In terms of ownership all companies in the list are publicly quoted and traded on the Jamaica Stock Exchange. With respect to the methodology used, Companies are ranked according to financial year 2010 data published by the Jamaica Stock Exchange. All figures are quoted in JA$ (,000).

As can be seen from the results only four companies listed

were able to post positive results above 2009 figures, largely indicating how challenging the business environment was in 2010.

Jamaica’s biggest company for 2010 and 2009 is GraceKennedy, one of the Caribbean’s largest and most dynamic corporate entities. The company started in Jamaica in 1922 as a small trading establishment and wharf operators has expanded and diversified over the years, changing from a privately-owned enterprise to a public company listed on the stock exchanges of Jamaica, and Trinidad & Tobago.Douglas Orane, Executive Chairman of GraceKennedy Limited, a position he assumed on July 1, 2011 is largely credited for the performance of the company. Prior to this position, he served as CEO from 1995 and, in 1998, added Chairman of the GraceKennedy Board of Directors to his portfolio. Mr. Orane’s career at GraceKennedy began in 1981 when he joined the company as Corporate Planner. Since then he has held several leadership positions in almost all areas of the highly diversified Group. An engineer by training, Mr. Orane holds a degree in Mechanical Engineering from Glasgow University. He is also a graduate of the Harvard Business School where he earned a Masters degree in Business Administration.

Under his guidance, GraceKennedy has articulated a vision of transforming itself from a Jamaican trading company into a global consumer products and services Group by the year 2020. His insistence on benchmarking to the best companies internationally has contributed to GraceKennedy’s success, and its continued profitability

even in an unpredictable Jamaican economy.

The future of GraceKennedy Limited now rest in the hands of Don Wehby who became Group Chief Executive Officer on July 1, 2011. Prior to this appointment, Mr. Wehby was Group Chief Operating Officer, a position he took up when he rejoined the company on October 5, 2009.

Today, the GraceKennedy Group comprises a varied network of some 60 subsidiaries and associated companies located across the Caribbean and in North and Central America and the United Kingdom. BM

JamaiCa’s biggest CompanY for 2009 and 2010 is graCeKennedY



As the global economies are posting slow and oft hiccup riddled recovery post- 2008 recession, the ripple effects have been felt in Jamaica too. As a result only seven of the Businessuite Top 20

Most Profitable listed companies were able to post positive growth in profits after tax for 2010 over 2009.

The companies who did make it there

have posted some impressive gains, despite the challenges; topping the list was Kingston Wharves with a whopping 294.38% increase followed by The Gleaner Company with 106%.

The Businessuite Most Profitable Jamaican Company for 2010 based on profits after tax is National Commercial Bank Jamaica (NCB) with 8.07% increase in 2010 over 2009.

NCB, which has its genesis over 170 years, when in 1837 the Colonial Bank of London, England, opened its doors on Harbour Street in Kingston. Through a series of mergers and acquisitions, the Bank eventually became known, in 1977, as National Commercial Bank Jamaica Limited.

Today trading on both the Jamaica and Trinidad & Tobago Stock Exchange, NCB has grown to become Jamaica’s largest financial services provider with 37.5% market share by assets of the commercial banking sector (as at March 2010). NCB has a varied portfolio of financial services and has network of 42 branch locations and over 170 ABMs across Jamaica.

The banking institution has strong and visionary leadership at the helm, with Chairman of the company Michael Lee-Chin, who has over who 32 years experience in financial services. He is also the Chairman and President of Portland Holdings Inc. and Chairman of NCB Jamaica Limited.

Portland Holdings Inc. is a privately held investment company which manages public equity, private equity

top 20 most profitable JamaiCan Companies for 2010


BUSINESSUITE TOP 20 MOST PROFITABLE

Profit After Tax2010 2009 Change %

1 National Commercial Bank Jamaica Ltd. 11,074,798 10,248,185 8.07%2 Scotia Group Jamaica Ltd. 10,701,767 11,605,459 (7.79%)3 Sagicor Life Jamaica 4,871,467 4,885,565 (0.29%)4 Lascelles deMercado & Co. Limited 3,114,189 2,559,024 21.69%5 Carreras Limited 3,001,875 4,093,911 (26.67%)6 GraceKennedy Limited 2,396,256 2,722,823 (11.99%)7 First Jamaica Investments 1,662,980 1,940,494 (14.30%)8 Pan Caribbean Financial Services 1,524,041 1,477,844 3.13%9 Scotia DBG Investments Ltd. 1,487,348 2,128,870 (30.13%)

10 Jamaica Broilers Group 1,312,801 828,063 58.54%11 Pan-Jamaican Investment Trust 1,244,498 1,395,677 (10.83%)12 Jamaica Money Market Brokers 986,378 1,102,622 (10.54%)13 Seprod Limited 830,263 1,485,937 (44.13%)14 Desnoes & Geddes Limited 789,398 1,551,323 (49.11%)15 Kingston Wharves 611,610 155,080 294.38%16 Gleaner Company 430,699 208,180 106.89%17 Supreme Ventures Ltd. 421,267 751,202 (43.92%)18 FirstCaribbean International Bank (Jamaica) 358,664 886,658 (59.55%)19 Jamaica Producers Group 302,104 209,748 44.03%20 Capital & Credit Financial Group 287,674 290,639 (1.02%)21 Radio Jamaica Ltd 221,621 -139,975 258.33%

22 Mayberry Investments Ltd. 174,530 245,473 (28.90%)23 Pulse Investments Limited 170,941 223,199 (23.41%)24 Access Financial Services Ltd. 147,206 65,999 123.04%25 Montego Bay Freeport 88,617 361,798 (75.51%)26 Salada Foods Jamaica Limited 81,408 108,195 (24.76%)27 Dolphin Cove Limited 69,170 104,726 (33.95%)28 Jamaican Teas Limited 58,035 72,458 (19.91%)29 Blue Power Group Limited 29,199 14,784 97.50%30 Hardware & Lumber Ltd 19,341 -225,762 108.57%31 Pegasus Hotels of Jamaica 17,159 55,243 (68.94%)

32 Palace Amusement Ltd 9,401 -5,286 277.85%33 Cargo Handlers Limited 1,326 1,452 (8.68%)34 Montego Bay Ice Co. Limited -5,990 -2,244 (166.96%)35 Jamaica Livestock Association -117,538 -232,329 49.41%36 Caribbean Cement Company -1,557,193 -144,512 (977.55%)37 Cable & Wireless (Jamaica) Ltd. -3,388,191 -302,825 (1018.86%)

Total 32,354,321 40,479,513 (20.07%)

COMPANY

top 20 Companies


as well as having direct ownership interest in a collection of diversified businesses operating in sectors that include media, tourism, health care, telecommunications and financial services.

Patrick Hylton, Group Managing Director for National Commercial Bank Jamaica Ltd has the unique distinction, no doubt among many others, as the only CEO to appear on every list and ranking of the Businessuite Top 10 CEO, since it was first published in 2005.

In his 2010 report to shareholders he cited The Jamaica Debt Exchange (JDX), as the most game changing of all 2010 events, which saw the holders of high yielding Government of Jamaica bonds exchange those for Bonds with lower yields and longer maturities. “This programme was fully supported by NCB as we knew this was in the best interest of the nation.”

Recognizing the significant impact the JDX could have on NCB’s financial

affairs, he was proactive in undertaking a number of initiatives to enhance revenue, contain costs and maintain a strong capital base and liquidity. “This is how we were able to deliver another successful financial year for our shareholders,” Mr. Hylton said. “We are grateful for the support of our directors, staff, customers and other stakeholders who helped to make this a reality.”

Last year Mr. Hylton indicated that he was on a mission to build the company’s financial fortress, believing strongly that it was is in the best interest of

all stakeholders that NCB continue this process. This financial fortress he suggested afforded NCB two main things.

1. The opportunity to maintain and develop the capabilities of the largest private sector workforce in the country and provide solid returns to shareholders

2. Allows NCB to increase investments in community service activities and serve as a solid source of tax revenues for government to support key programmes.

“For the year ended September 30, 2010, we have demonstrated in many ways our desire to continue to meet the financial needs of our customers. We led the market in lowering auto loan rates to 16.95% and were the first to introduce the 9% FARM loan to help foster growth within our agricultural sector. Another key initiative was our Cut Your Bank Fees campaign which helped our customers reduce and eliminate banking fees by

accessing low cost banking channels. We also continued our Money Matters campaign, which is geared towards helping NCB customers with budgeting tools and tips, saving options and debt consolidation.”

Patrick Hylton first received local and international acclaim when he was appointed to a leading role by the Government in the rehabilitation of the Jamaican financial sector during the mid 1990s. The wealth of his experience in all facets of the financial services industry led to him being named the Managing Director of FINSAC for five (5) years, where he had responsibility for the re-structuring and divestment of intervened financial institutions and the acquired assets. His successful completion of that undertaking culminated in the national award of the Order of Distinction, Commander Class, being bestowed on him by the Governor General of Jamaica in 2002.

In 2002 he joined National Commercial Bank Jamaica Limited (NCB), as the Deputy Group Managing Director, where his responsibilities included the Bank’s investment and insurance subsidiaries. On December 1, 2004 Mr. Hylton was appointed the Group Managing Director of NCB and since then he has led the organization to achieve record growth in profitability.

GraceKennedy Limited which topped our Top 20 Largest Companies by Revenue ranking dropped to 6th position on the back of an 11.99% percent reduction in profits for 2010 over 2009.

The Businessuite Top 20 Most Profitable Jamaican Companies for 2010 used methodology to rank companies according to financial year 2010 data published by the Jamaica Stock Exchange. In terms of ownership all companies in the list are publicly quoted and traded on the Jamaica Stock Exchange.

top 20 Companies


There are Boomers II or Generation Jones, born who were born 1955 to 1965, they build the foundation plant-ed the seeds of corporate Jamaica and nurtured it…fast forward to 21st cen-tury and its time for change of guard. In this era of rapid evolution, fast pace technology, and with the world being shrunk to a global village, corporate Ja-maica is seeing sweeping change in its leadership. It is the Generation X who were born 1966-1976 – the young, suave and tech savvy - taking the baton from the boomers and anchoring the run. Their dynamism is evident by the fact that they are dominating the Businessuite Top 20 CEO list for 2010. They are:

1. Christopher Barnes2. Christopher Levy3. Jeffrey Hall4. Patrick Hylton 5. Donovan Perkins6. Keith Duncan7. Stephen Facey8. Michael Bernard

9. Anya Schnoor10. Alan Barnes

Internationally, they are sometimes re-ferred to as the “lost” generation; this was the first generation of “latchkey” kids, exposed to lots of daycare and divorce. Known as the generation with the lowest voting participation rate of any generation, Gen Xers were quoted by Newsweek as “the generation that dropped out without ever turning on the news or tuning in to the social is-sues around them.”In Jamaica they are running some of the largest and most profitable compa-nies in the Caribbean lead by Patrick Hylton Group President and CEO of National Commercial Bank Jamaica.It’s interesting to note that four of the eleven members on the list assumed the CEO position from their parents. These included Christopher Levy, Jef-frey Hall and Stephen Facey from their Father and in the case of Keith Duncan his mother.The others were handpicked and care-

fully groomed for the top spot.But in this coveted list, there is absence of an equitable number of females. Anya Schnoor Businessuite top CEO for 2008 is the lone female there. (Tech CEOs in 2011: Where Are the Women? In this issue)According to internationally published data we see where Gen Xers are argu-ably the best educated generation with 29% obtaining a bachelor’s degree or higher (this is 6% higher than the pre-vious cohort). And, with that educa-tion and a growing maturity they are starting to form families with a higher level of caution and pragmatism than their parents demonstrated. Concerns run high over avoiding broken homes, kids growing up without a parent around and financial planning.

SUCCESSION PLANNINGIn an article titled, A Further Look At The Success Of Succession Plan-ning written by Deon McLennon of Stocks and securities Jamaica, pub-lished in Jamaica Observer, suggested that “Succession planning is one of the most intricate challenges an organiza-tion will ever face. Few events in the life of a company are as critical, visible, or stressful as the transition of leader-ship. The eyes of every stakeholder — shareholder, employee, customer and supplier, are focused on how the baton changes hands. This transition reveals the character and effectiveness of the incumbent leaders and the organisa-tion.”McLennon goes on to say that “Es-tablished and new organizations have been combating the looming leader-ship succession predicament by

the emergenCe of generation X Ceos in Corporate JamaiCa-Charting the suCCession plan that got them there.

succession

identifying and developing the inter-nal talent needed for key executive positions.” For example, he cites the case of two local firms who have not been outdone in this respect. “In June 2007, after 28 years of service at Jamaica Producers Group Ltd (JP), Dr Marshall Hall, for-mer CEO of the Company, handed the control to his son, Jeffrey Hall. Jeffrey was the Business Development Man-ager at the time and sat on JP’s Board since March 2004. Prior to that, he was the Divisional Director for Ba-nanas. Hall was mentored by his fa-ther for many years, and knew the ins and outs of the company by the time he was nominated to lead the firm.”Through effective succession plan-ning a culture of strong leadership will be developed throughout the firm whereby employees show effective leadership at all levels. GraceKennedy

Ltd (GK) understands this, and has been developing its succession plan since at least 2006. In 2008, it an-nounced that it had implemented a structured succession plan for all sen-ior management functions across the group. The Company has been trans-parent about Douglas Orane’s retire-ment as Chairman and CEO of the Group. Though no date has been set yet for his departure, investors are not perturbed, as they have been kept in the loop about GK’s succession plan.

TOO YOUNG TO LEAD?The question some ask is whether these individual should be handed the reins of such power at such an early age. Al Edwards, business editor of Jamaica Observer recently wrote the following view on age and leadership.“On the world political stage, the likes of Barack Obama, David Cameron and

Julia Gillard of Australia are relative-ly young leaders, all under 52. In the corporate world, Steve Jobs of Apple recently passed at 56, having founded his company 35 years ago. Jeffrey Im-melt succeeded Jack Welsh at Gen-eral Electric at 44 in 2000. Today he is 56, having spent 11 years in the top job. The social networking site Face-book was formed by Mark Zucker-berg in 2005. Today, at 27, he serves as its president and CEO. American economist and central banker Timo-thy Geithner was appointed as Unit-ed States Secretary of the Treasury in 2009 at the age of 48. Indra Nooyi became President and CFO of Pep-siCo at 45 back in 2000, rising to the CEO position six years later. At 47, Wehby’s ascension is timely. He is now a part of this corporate zeitgeist and will make GraceKennedy a 21st century corporation with a footprint

2005 -2009 Top 10 Ranking2010 CEO

1 Grantley Stephenson Kingston Wharves 2 Christopher Barnes Gleaner Company3 Christopher Levy Jamaica Broilers Group4 Jeffrey Hall Jamaica Producers Group5 William McConnell Lascelles deMercado & Co. Limited 6 Patrick Hylton National Commercial Bank Jamaica Ltd.7 Donovan Perkins Pan Caribbean Financial Services8 Richard Byles Sagicor Life Jamaica9 Bruce Bowen Scotia Group Jamaica Ltd.10 Keith Duncan Jamaica Money Market Brokers11 Stephen Facey Pan-Jamaican Investment Trust12 Douglas Orane GraceKennedy Limited13 Stephen Facey First Jamaica Investments14 Michael Bernard Carreras Limited15 Anya Schnoor Scotia DBG Investments Ltd.16 Brian George Supreme Ventures Ltd.17 Byron Thompson Seprod Limited18 Alan Barnes Desnoes & Geddes Limited 19 Clovis Metcalfe FirstCaribbean International Bank (Jamaica)

COMPANY

across the entire globe.” But what is the secret of suc-cessful leadership transition and success. McLennon sug-gests…“Companies that have a history of successfully tran-sitioning leadership have a routine of grooming people for the top position.”Edwards further adds. “The first step is to identify gaps between the required leader-ship and the existing talent pool. If the retiring Directors/Managers were responsible for sales dynamism, strict fi-nancial control, key account customer loyalty or engineer-ing innovation, these criti-cal skill gaps will need to be seamlessly filled”.

“The range of skills and employees’ competencies are then developed in the most cost effective ways to fill these gaps. As a result, strong leadership is built in the organisation which helps the business not only survive but thrive in the marketplace amid difficult conditions” Edwards opines.Editors note. Businessuite was not able to independently confirm the age of the CEOs identified in this article up to press time and is therefore subject to change and update.


succession

study revealing that CEO image continues to be a significant determinant of share-holder value. According to David Larcker, professor of accounting at the Wharton School of the University of Pennsylvania and an author of the Value Creation Index with the Ernst & Young Center for Business Innovation (Forbes ASAP, April 3, 2000), a 10 per cent change in CEO reputation in the Burson-Marsteller study results in an estimated 24 per cent change in a company’s market capitalization.

Paying attention pays off.

Burson-Marsteller surveyed approximately 1,400 influential business people from five key stakeholder categories, including CEOs, other senior executives, financial analysts, government officials, and journalists. Comparing this survey to the first CEO reputation study Burson-Marsteller published in 1997, the results reveal that the importance of CEO reputation has increased by as much as 14 per cent. Other new findings the survey revealed include:

Can represent a staggering 45 per cent of a company’s reputation.

Companies whose CEOs were rated most admired’ by respondents achieved a 13 per cent annual shareholder return, while companies whose CEOs were rated less favorably delivered a negative 28 per cent annual shareholder return. 95 per cent of

financial and industry analysts surveyed said they would purchase stock based upon a CEO’s reputation an 11 per cent increase from 1997 and 94 per cent said they would recommend a company’s stock based on the CEO’s reputation. 81 per cent of respondents said the CEO’s reputation would influence their opinion of a company under media scrutiny. 80 per cent of respondents said the CEO’s reputation would influence whether or not they would recommend a company as a good place to work.

A marked difference between the 1997 and most recent survey, however, concerns the CEO attribute labeled `caring about customers’. While it was ranked as most important in 1997, it fell to sixth place in the new study. Burson-Marsteller asserts that the change in rank occurred largely because a CEO’s demonstrated responsiveness to customer needs is no longer considered an attribute capable of solely empowering a company to surpass the competition.

Rather, CEO care for customers has become

an expected requirement for all companies that wish to be competitive in today’s business environment.

gREATER EXPECTATIONs

With these new expectations, stakeholders are paying closer attention to corporate leaders than ever before. In fact, as the marketplace becomes increasingly overrun

Losers

Company % Open CloseCiboney Group (70.00%) 0.10 0.03Pulse Investments (57.72%) 5.44 2.30Pegasus Hotel (39.92%) 19.99 12.01Guardian Holdings Limited (26.54%) 299.50 220.00Trinidad Cement Limited (26.39%) 72.00 53.00Capital & Credit Financial Group (25.17%) 4.41 3.30Montego Freeport (24.74%) 1.90 1.43Palace Amusement (23.33%) 60.00 46.00Caribbean Cement Company (23.25%) 4.00 3.07Kingston Properties Limited (22.00%) 5.00 3.90Jamaica Producers Group (21.78%) 25.89 20.25Salada Foods Jamaica (16.13%) 15.50 13.00Cable & Wireless (Jamaica) (13.16%) 0.38 0.33First Caribbean International Bank (3.33%) 117.94 114.01

Continued from page 4

with the newest companies each offering the latest products and services and using first-of-a-kind delivery channels CEO-watching has become the new American pastime. This focus on CEOs is not limited to business people either. Consumers who are increasingly investing in the stock market are the most recent CEO spectators. With information and technology overload assaulting all audiences, a CEO’s reputation can serve as a mental shortcut to company perceptions and do more than boldly differentiate a company from others in the corporate landscape. It can be one of the most powerful tools used to create shareholder value, win support during times of crisis, and help attract and retain the best and the brightest employees.

In addition, as companies continue to merge into global Goliaths, they are producing an increased uncertainty in the market. During such times investors are more likely to entrust their resources to CEOs who they are certain possess the professional skills and personal attributes necessary to usher their enterprise through massive change, into the new millennium’s global information economy.

Worth magazine recognized this phenomenon in its May 1999 cover story, which featured its first annual list of CEOs most likely to build value for their shareholders.

The article emphasized that popular investing has turned eyes more closely on CEOs as prominent public figures; in turn, `shareholders quickly learn that a CEO’s decisions and pronouncements can have a profound and often sudden impact on the value of their holdings.

Fortunes can be made or lost in an instant. It’s a relationship certain to create both heroes and goats’. Moreover, if you had followed their advice in 1999, you would have been smart in year 2000. According to Worth, if you had bet an equal amount of money on each of the CEOs nominated in 1999, you would have seen returns slightly over 30 per cent.

Herb Allen, the well known financier, knows about the `CEO effect’ on investing: “For a long-term investor the only kind of investing I do at Allen & Co the CEO is absolutely the key to the whole thing. He’s much more important to me than the business itself.”

Internet SourceCEO Reputation: A Key Factor in Shareholder Value: Leslie Gaines-Ross Burson-Marstellerhttp://reputationinstitute.com/crr/V03/Gaines-Ross.pdf


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businessuite magazine special november 2011 issue

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