Let me start by wishing you all a Happy New Year!! I hope you all had a relaxing and enjoyable Christmas Season and you are facing 2016 with renewed energy and enthusiasm. I am happy to say that in spite of falling short of our budget to the end of Q3 by 1%, we have managed to stay slightly ahead of the profit target for the year. Whilst this can make one think the position we are in is a favourable one, it should be noted that December’s results were soft and we can safely say that our Company is already feeling the effects of the economic slowdown as we fell short of the December sales target by 10%. There is no doubt now that we will face tough economic times as since my last address the price of oil has slipped from US$ 46 to US$ 33. Many speculate that it may likely drop to $22 and some even predict a collapse to $10. Time will tell where it ends up but it’s safe to say that we are indeed facing a time of complete uncertainty. Will we have access to all the US dollars we require? If so what is the rate we will have to pay for it? How much will the GOVTT tap into the ‘Heritage and Stabilization Fund’ in order to stimulate the economy? These questions and many more cannot be answered at this point in time but the answers will surely affect our business.
In times like these it is ever important that all of us take a ruthless look at our expenses and ensure that we invest only in high payoff activities. These times also make it ever more critical to protect the Company’s assets. In this regard we are pleased to report that recent legal action taken against an employee who admitted to fraudulent activity with Company funds yielded a very positive result. In an effort to avoid potential jail-time, she settled out of court with the Company for a substantial amount of the misplaced funds.
From a Divisional perspective, the last quarter will be challenging and we need to band together and pull out all stops if we are to meet our budgeted figures for Q4. We need to focus on ‘value propositions’ going forward so as to ensure our products continue to be attractive to shoppers and consumers. The Premium Beverages Division continues to see success with a few key product classes and hopefully this trend continues as these are made up of ‘lifestyle’ brands which we hope will weather the storm. The Food & Grocery Division is still struggling to get control of the margin leakages from damages and expiries etc. We need to pay particular attention to ensure that this experience improves in the coming months. Stephen and his team have taken steps to rectify the situation and hope that things improve soon as a result. The Hardware & Housewares Division is slightly behind budgeted figures but is showing a profit above target which is great. They will be putting particular focus behind TRUPER this year as the line offers remarkable value for money products and has a vast portfolio. The situation for the Food Service Division remains much the same and Hayden has been focusing on pruning his portfolio to maximize efficiency. His team has taken over responsibility for selling Food & Grocery Division’s products to the HORECA channel and this is helping with his profitability. SkyWay ‘s sales are up slightly over last year but the profit figure is almost identical due to some cost increases this year. We continue to face stiff competition in the Duty Free arena with TWEE acquiring the spot next to them and expanding their footprint and product range to include fragrances. We recently had a very productive meeting with the SkyWay team and hope to roll out a few initiatives that were brought forward. The Naughty Grape ‘walk-in’ sales are up on prior year and the store has posted a good profit year to date. We expect to move during Q4 and look forward to the opening of what is the first of more locations to come in the future!!
The budgets for Q3 were higher than ever and of course this meant increased strain on our support service teams in particular during the period. On behalf of the Board of Directors and Management I wish to express my genuine and heartfelt thanks to all of you who held things together during this challenging time of year for our Company.
I will take this opportunity to again express my appreciation to my assistant Mandy Nunes and her team that organized the ‘Back in times’ Staff Party! I was approached by quite a few of you on the night who voiced that it was one of our best events ever!! It appeared that all had a ball to the point that we had to extend the hours and shut down later than planned. A lot of effort went into it and I am happy that the staff appreciated it all in the end.
As I alluded to in the beginning, the environment continues to be challenging, but we remain confident that we have a staff here at Brydens that will bind together and leverage our amazing relationships that we have developed with our customers and continue to develop our business. I also implore you all to go the extra mile and give above and beyond what is expected of you. This will allow us to prevail in spite of the conditions and I urge you all to continue to live by the Company’s values as we move forward as this becomes ever more important in tougher times.
In closing I would like to thank you all for your ongoing efforts and ask you to give a strong push as we enter the last quarter of our fiscal to ensure we deliver on our commitments.
In October, the Human Resources Department conducted a three (3) day Supervisory Training workshop for twelve members of staff. The training was facilitated by Kathleen Stroud. Over the three days the participants were involved in a number of class room and outdoor activities focused on preparing them for their new roles as Supervisors. Key learning’s from the training included: special tips for new supervisors, communicating effectively with your direct reports, building a high performance team and learning to delegate
We look forward to seeing what they learnt put into action! We wish them all the best!
The Human Resources Team
Tiffany Reid, HR Manager
Arif Mollick HR Officer
OPERATIONS
Contributed by: Wayne Doopan, General Manager
This quarter proved extremely challenging for the Distribution Centre at both the Lapwing and Fernandes locations. Both locations were faced with space constraints with occupancy levels averaging close to 100% for most of the quarter. The Fernandes team continues to lead the way, with this being one of the smoothest peak periods in recent history. Faced in October with one of the biggest targets in the history of H&H, the Fernandes team was able to pick and deliver all the items sold so we could achieve the target. A record was set in October for the highest value ever picked in a single day (2.1m). The Lapwing team also performed well given all the challenges they faced i.e. lack of space, limited delivery vehicles and on certain days high absenteeism.
The expansion of the parking facilities on the eastern side of the Distribution Centre was completed in early November. We can now accommodate around an additional 30 parking spots in this area. These additional parking spots should ease the parking constraints employees face on a daily basis.
Every year Guardian General Insurance Limited pays homage to their Agents for excellence in performance. A.S. Bryden & Sons (Insurance) Limited topped in all criteria in the Medium Business Category and took home the award for Best Performing Agency in 2014. The award was on the achievement of targets that are aligned with GGIL's overall objectives for Growth, Profitability and Operational Efficiency. The Company ranked highest in; Growth in Premium Income, New Business Growth, Renewal Retention, Loss Ratios and Timeliness of premium payments. This remarkable achievement is attributed to the services and administration of our own Samantha Maharaj, who offers nothing less than "Red Carpet Service" to all internal and external customers
TRADE MARKETING
Contributed by:
Micha Cooper - Trade Marketing Manager
Q3 2015 was a very dynamic, yet challenging quarter for Trade Marketing, as momentum was regained somewhat in October following a lull during the election period. For the 3rd Quarter of 2015, the Supermarket channel grew 1% vs. PYQ2 and brings the channel YTD growth to 7% vs. PYTD. This is a bit of a slowdown from the double-digit growth performance we achieved in Q1 and Q2, which were up 10% and 16% respectively. This was largely due to declines in November and December (-3% Nov and -1% Dec). Despite this, there was solid growth in 9 of our 10 Top accounts up to November.
Special projects continue to gain us significant traction in the areas of Category Management and Retail Innovation, leading to success in key growth categories such as Cheese, Gums and Chocolates. In October, we were able to expand on the success of the Kraft Cheese Category Management project, which was launched in Massy Stores, by replicating this at Pennysavers Canaan, Tobago. Another milestone was achieved with Massy Stores for our Chocolate and Gums categories, via a pilot checkout test launched in November in Massy Alyce Glen and Massy Broadway, with prime positioning and space granted to our Adams and Cadbury portfolios. On the Retail Innovation side, exciting projects are ongoing with intensive focus on the new JTA C3 Hypermarket scheduled to open early 2016. Also in JTA and MS Food City, resets and lane branding for Premium Beverages were successfully achieved.
Finally, we continue to prioritize and see the growth and development of our merchandising team. Firstly, in October, the East merchandising team emerged as winners of the first ever Hennessy Area Contest for most space expansion and secondary displays in the supermarkets. This earned them the grand prize of complimentary access to Hennessy Artistry! Great work, and thanks to Chris DeVerteuil for working with us on such an excellent initiative! We would also like to congratulate two of our Senior Merchandisers on their promotions to Sales Rep positions in the F&G division – Jenny Mungal and Natalie Noel. We are very proud of you both! To finish the year, our 2nd Core Value Awards were once again successful, recognizing outstanding performers in each area for their consistent embodiment of our company values.
In Q3 2015 the Food Service Division saw relatively flat growth versus the same period for 2014. The Division also fell short of budgeted numbers; however, we were able to increase our GP margin from 12.44% in Q3 2014, to 21.90% for the same period 2015; this resulted in a 58% increase to our bottom-line and look forward to an improved performance in Q4.
We continue to pay close attention to our stock levels with the objective of selling off and delisting all slow moving and dead stock items and at the same time the division was able to reduce its cover from nine (9) months at the beginning of Q2 2015 to seven (7) months at the end of Q3 2015.
Despite the many challenges we face as a new Division, we conscientiously strive to improve our results and look forward to your continued support...
FOOD & GROCERY
Contributed by: Stephen Welch - Division Director
For the period October – December 2015, the F&G Division had a strong performance. With the constraints on foreign currency, the budget presentation, notice of changes to the VAT system, higher fuel costs and the announcement of a recession, we ended the quarter down 0.8% in sales when compared to the similar period last year. On a more positive note, through better management of our pricing and deals being offered to the trade, we increased our margin during this period by 2.7 percentage points which placed us in a position to deliver on our commitment to our shareholders.
Our success, as always, is built around our people and their belief in our brands and our business. We have all rallied for the period and gone about our business as professionals. To single out one person or one group would not be fitting as everyone has their part to play and has done it reasonably well.
For the coming fourth quarter there will be some changes. To begin, we have decided (and already moved) to delist two lines within the department – namely Grace and Ralstons. This move has allowed us to consolidate six beverage routes within the van team into the existing 13 food routes which creates some very good efficiency in this team. We also took a critical look at all our SKU’s within the portfolio to determine which, are adding value to our business and those which are not. Any item found not to be adding value and of no strategic value was earmarked for delisting. Through this process, over the coming months, about 25% of the items we currently carry will be delisted. Again, this improves our efficiency, simplifies our business and allows our team to focus on the items which have the most potential for growth.
Q3 began positively with many of our customers taking advantage of our Annual Christmas Show held at the end of September. The Show enjoyed a 20% growth in sales over last year and our attendees increased from 80 to 110. Hardware brands played a bigger role and added an extra diversity which enhanced cross purchasing from our different channels. Turnover for the quarter fell 4.5% below budget but was 5.3 % higher than the same period last year. The Hardware Division performed very well as it exceeded the quarterly budget by 5.5%. Housewares fell 7.8% below budget as a result of softening Whirlpool and Samsung Sales. Overall a great effort was made by the whole team. Our Service Division was also restructured in November and is now in a strong position for continued growth from all of our appliance brands.
As we enter the last quarter of our financial year, our team spirit remains high as we ready ourselves for the economic challenges that lie ahead in 2016.
Contributed by:
Nicholas Hosepdales - Division Director
Quarter 3 is the most critical period for the Premium Beverage business. Having built a solid foundation from March to September, we entered Q3 with a quiet confidence that we will continue to produce year-on-year growth and deliver on our budget. October saw the sales team deliver results 15% above the budget and helped build our confidence. However, a minor shortfall in November followed by a significantly slower December led to an overall 4% shortfall for the quarter versus our budget.
Key issues impacting results include:
The Central Bank’s and Government’s statements regarding curbing spending based on energy prices and economic contraction;
The impending changes in the VAT regime;
Parallel trade impacting a wider range of brands
On the positive side we have made significant inroads with several key wholesalers, and resisted opportunities to load these wholesalers with excess stocks to carry into the last quarter. Our fight against the parallel trade is increasing in intensity as we lobby government ministries and pressure suppliers to take positive action against unauthorized importers. Our relationships with on- and off-premise customers continue to improve and this will pay dividends over the long term.
During the quarter we had two very exciting events for our brands. First there was the landmark event Reggae on The Bay presents Hennessy Artistry. The event, headlined by Damian “Jr. Gong” Marley saw massive crowds at the Hasley Crawford Training Ground and provided invaluable exposure for the Hennessy brand which continues to grow in our market. On December 20th Smirnoff was a major sponsor of the annual Sunset Festival at O2 Park in Chaguaramas. The event saw approximately 7,000 fans of electronic dance music (EDM) gather to enjoy the sounds of Major Lazer and Martin Garrix. Smirnoff Electric made its market debut at this event and scored a home run with our target consumer.
For the final quarter of the year the Premium Beverage division is working on several new product offerings, some that will put us into new areas of the market and categories in which we’ve never had a presence. Tireless work from our Promo Team has built a strong reputation and even stronger relationships with fete promoters. We are this year managing more executions/events than ever before, even in a very short Carnival season. Some brands that were never considered in all-inclusive events are gaining traction from these relationships, and we have even gained full exclusivity in some of these parties. In spite of its brevity, the Carnival season is shaping up positively and the Promo Team deserve credit for their efforts.
Though the economic expectations are uncertain, our new products, new routes to market and continued focus on relationships will steer us through the challenges ahead.
RETAIL STORES
Contributed by: Janine Rajah-Medford - Business Development Manager
The Naughty Grape ended December with sales up 9% over the same fiscal period last year but down 1% versus the budget for the YTD. In November, we relaunched the e-commerce site www.naughtygrapett.com with a fresh new layout with the assistance of the Digital Team with project manager Terri-Ann Persad at the helm. The re-design was driven by a new e-commerce strategy focusing on savings and convenience via delivery to your door. The launch was accompanied by a Flash Sale which was extremely successful and set the tone going forward. By December, online sales accounted for just about 5% of total sales for the season which is quite promising for the future. The success would not be possible without the marketing efforts of Retail Marketing Assistant, Takiyah Voisin and Facebook Digital Strategist, Jennalyne Boodram.
For December, the Store weathered several challenges with regards to stock fulfilment and longer than usual transaction processing times (to name a few) which sometimes affected customer service. The Team continues to explore options for the future which can assist in overcoming these issues which with better communication and planning can be rectified.
The Team wishes to thank, Benn Fitzwilliam, Business Development Officer for taking the time to assist at the Store for the Season along with Brand Team Members, Joshua Du Coudray, Kafele Crichton, Keisha Maraj, Arveyann Thomas and Nastassia Maharaj.
Contributed by: Janine Rajah-Medford - Business Development Manager
SkyWay Duty Free ended December with Sales up 9% over the same fiscal period and 3% over budget. Fragrances continue to perform well, with record figures for the year to date in December. Overall our Fragrance Suppliers are quite pleased with the turnaround in the performance of the category since the change in structure in 2014 which has allowed sales to double between 2013 vs 2014 and attain an additional 15% growth to end of December 2015.
The Team continues to face issues with regards to staffing (an ongoing challenge) but is working closely with the HR Team to get the necessary numbers in order for the store to run as a full 24 hour operation. The staffing issue ultimately places pressure on the existing staff which at times affects customer service but like with Naughty Grape, the Business Development Team has identified this as a key issue to work on on an on-going basis to ensure maximum customer satisfaction.
