Local manufacturing giant, Demerara Distillers Limited (DDL), has recorded yet another year of stellar performance with its Group raking in some $5.969 billion in profit after tax in 2023.
This was revealed by the Chairman of the DDL Group, Komal Samaroo, in his annual report on the 2023 financial year. Last year’s $5.9 billion profit after taxation represents an increase of 12 per cent or $648 million over the $5.321 billion recorded in 2022.
The Group’s profit before taxation for the year was $7.674 billion, compared to $7.086 billion in 2022 – a growth of $588 million or just over eight per cent. During the reporting period, earnings per share was $7.75 compared to $6.91 in the previous year.
Shareholders’ Equity at the end of the year was $53.353 billion, reflecting an increase of approximately 5 per cent on the amount at the end of 2022 when it was $50.934 billion.
Additionally, the Group’s turnover in 2023 was approximately $33.3 billion, representing a growth of $1.9 billion or six per cent over the previous year’s turnover of $31.4 billion.
International revenue grew by three per cent during the reporting year over that of 2022 despite the challenges explained earlier. In addition, domestic revenue increased by seven per cent over that of the previous year. The diversification of the Group and the continued premiumization of its core brands contributed to this growth.
An interim dividend of $0.40 per share was paid to shareholders in December 2023.
The Directors have recommended a final dividend of $1.60 per share which, if approved by shareholders at the upcoming Annual General Meeting this Friday, April 19 at the Guyana National Stadium tarmac, will result in a total dividend of $2.00 per share. In the previous year, dividend payments totalled $1.75 per share.
The dividend paid and proposed for 2023 will, if approved, result in an appropriation of $1.54 billion or 26 per cent of the profit of the Group for the year. In the preceding year, dividends paid required an appropriation of $1.3475 billion.
According to Samaroo in his report, 2023 was another successful, but challenging year for the Group.
“The pursuit of diversified growth over the years helped in no small measure to circumvent some of the challenges that resulted from geo-political risks and tensions globally. In addition, the strong growth of the Guyana economy positively influenced the results for the year, resulting in yet another year of continued growth for the Group,” the DDL Chairman noted.
He disclosed that the Group recorded its highest level of Capital Expenditure in 2023, as it focused on investments that will expand capacity and modernise its operations as well as allow for greater product and service diversity, and will ultimately grow and sustain revenue within the Group.
Capital Expenditure in the year was over $8.4 billion, almost two-thirds of which was funded from funds generated by the Group, and the balance was funded by a loan from the Inter-American Development Bank Invest (IDB Invest).
The largest investment being pursued has been the major expansion of the Group’s Beverage Plant, which is expected to cost around $10 billion to be expended over three years (2022-2025) of implementation. When completed, the production capacity of this operation will almost tripple, providing a wider range of products for both domestic and export markets.
During 2023, the beverage company completed the expansion of a storage bond at the Liquor Bottling Plant at a total cost of $430 million and a Drainage Enhancement Project to the tune of $225 million.
Other major projects are in progress at the end of the reporting year including the Distillery Service Equipment Replacement – the final phase of the distillery production expansion project which when completed will realise the full productive capacity of the plant, making it possible to increase the installed capacity by 25 per cent.
Additionally, the World Trade Centre project on High Street in Georgetown is also in progress and when completed, will offer over 25,000 square feet of modern office space, conferencing facilities and other support services.
Also in progress are DDL’s Moblissa Dairy Project to provide fresh milk for the Topco Packaging Plant, which will also contribute significantly to the reduction in the regional food import bill by producing five million liters of fresh cow’s milk utilising the most modern agricultural practices; upgrading the port facility of Demerara Shipping Co. Ltd on Water Street in Georgetown, which will position the company to take advantage of the increased volumes of imports and exports of cargoes as a result of rapid growth in the local economy; and a new warehouse to provide additional space for 28,000 barrels of rum for aging to support the growth of the company’s brands.
Samaroo explained “These projects are designed to advance the Group’s diversification while continuing to build greater competitiveness in its traditional businesses. These investments will position the Group to expand its revenue base as it takes advantage of new opportunities in a rapidly changing and growing marketplace locally, regionally, and internationally.”
In 2023, DDL developed several new beverage products and also maintained its international quality certifications to support its marketing efforts.
The Group further enhanced focus on retention, engagement, training career advancement and staff welfare matters. Due to the increased demand nationally for both skilled and unskilled employees, new policies have been implemented to better engage existing employees while new employees are more carefully inducted and onboarded in their new positions. A new position of Employee Onboarding and Engagement Manager was created to provide focus and leadership in this area.
According to the Chairman, training continues to be a priority with 51 formal training programmes conducted at DIMATECH, the in-house training centre of the company, targeting more than 1500 employees in various areas.
Going forward, Samaroo pointed out that the Group’s expansion and planned growth will most certainly put it in a strong position to take advantage of the new opportunities being created as Guyana leads the regional food security drive. He added that the company is also continuing its international marketing drive to expand the distribution of its rum brands in unserved markets around the world.
“I believe that with the completion of the several ongoing projects in 2024 we can look forward to strong growth in future years,” the DDL Chairman stated.
