Bahrain Maritime & Mercantile International (BMMI Group) announced today a strong financial and successful operational performance for the year ended 31 December 2009.
Total sales revenues reached a new record of BD 87.2 million in 2009 compared to BD 80.4 million the previous year. Net profit of BD 9 million was the third highest in the Group’s history, while shareholders’ funds increased to BD 44.6 million, up 10.7 per cent over 2008, resulting in an improved return-on-equity (RoE) of 20 per cent. A key financial highlight of the year was a dramatic increase in the group’s liquidity, with cash and short-term deposits almost doubling to BD 12 million compared to BD 6.7 million in 2008.
Total comprehensive income for the year grew by over 70 per cent, reflecting net unrealised gains on available-for-sale (AFS) investments of BD 7 million compared to losses of BD 1.8 million in 2008. In line with the Group’s prudent investment approach, and due to the devaluation of some investments, provisions of BD 1 million were made against impairments losses on AFS securities, which are substantially lower than 2008 provisions of BD 1.78 million. In spite of the above, the Group’s investment portfolio remains profitable, and further improvement is expected in 2010 as the markets continue to recover.
Total operating profit dropped in 2009 to BD 8.7 million from BD 9.6 million the previous year, largely reflecting higher general and administrative expenses (which rose by 16.4 per cent),reduced margins by consumer brand principals and other suppliers, the setting-up of new Alosra Supermarket outlets, and higher staff costs. Total assets decreased from BD 62.4 million in 2008 to BD 57.8 million in 2009, due to a reduction in inventories and trade receivables.
The Group’s strong financial performance resulted in an increase in dividend cover (multiples) in 2009 to 1.7 compared to 1.5 the previous year, while earnings per share rose from Bahraini fils 73 to Bahraini fils 87, representing an increase of over 19 per cent.
Commenting on the year’s performance, BMMI Group Chairman, Mr. Abdulla Buhindi, said: “Given the difficult and demanding market conditions that characterised 2009, the Group’s exceptional financial performance must rank as one of the most successful during BMMI’s long history. During the year, we continued to enhance the Group’s institutional capability, further strengthening our corporate governance and risk management framework. The planned introduction of an Enterprise Risk Management (ERM) system in 2010 will enable us to manage more effectively the Group’s increased risk exposure due to our growing international operations.
“This is an important element of the Group’s new five-year strategy that was approved by the Board in late 2009, and which provides us with a clear picture of our future direction and business objectives. Also during the year, we continued to implement our role as a concerned and responsible corporate citizen. In a first for a commercial listed company in the Kingdom of Bahrain, BMMI established the Alosra Charitable Foundation to manage and protect the funds that the Group sets aside every year for philanthropic and community support activities,” he added.
According to Executive Officer, Mr. Gordon Boyle, “Operationally, 2009 was both a successful and exciting year for BMMI. Despite the challenging global and regional business environment, all of the Group’s business divisions, subsidiaries and joint-ventures successfully continued to expand their operations, posting strong year-on-year revenue growth, and contributing to BMMI’s bottom line. Exciting business developments include the launch of new BMMI-owned consumer brands (such as the Great Deli Company) for the first time in our history; the expansion of Alosra Supermarket’s footprint across Bahrain; further awards from brand principals for our consumer wholesale operations in Bahrain and Qatar; the consolidation of our new subsidiary – Global Sourcing & Supply– which now operates from seven platforms in Africa and the GCC and the continued success of our government and defence supply contracts in the Middle East and Africa.
“During 2008, we also continued to strengthen the Group’s organisational capability, with a particular focus on recruitment, human resources development, information technology, quality, and health and safety. The demand-driven and diversified nature of our core business activities will continue to shield us from the worst of the current global financial crisis and its impact on the GCC. Strongly capitalised, highly liquid, unleveraged, and with a clear strategic plan for the immediate future, the Group is well positioned to meet the challenges of 2010 and to take advantage of new business opportunities,” he stressed.