From left: Farsons Group CEO, Mr Louis A. Farrugia, Farsons Chairman, Mr Bryan A. Gera
and Company Secretary Mr Arthur Muscat
The completion during this year of the new Soft Drinks Packaging Hall and the Logistics Centre in Mriehel will signify the realisation of the first two phases of the Farsons investment programme which is on track and within budget. The third phase, that of a new Brewhouse, is planned in 2009-2011. This was stated by by Farsons Group CEO, Mr Louis A Farrugia, when he addressed shareholders during the 60th Annual General Meeting of Simonds Farsons Cisk plc.
He said that the soft drinks market is on the eve of a major packaging revolution when on 1 January 2008 will signal the end of the derogation period negotiated by Malta with the EU whereby the sale of product other than returnable glass is prohibited. In effect this will open the market up to more intensive competitive activity.
The investment programme by SFC has been designed to prepare the Group for this development. When operational, Farsons will guarantee a fresher product to consumer as well as improved service to its customers.
The above programme will also release substantial shareholder value in properties that will be vacated at Wands, Qormi and at the Notabile Road façade of the Mriehel site.
When Company Chairman Mr Bryan A. Gera addressed the shareholders, he referred to the 2% increase in Group’s turnover from Lm26,189,000 / €61,003,960 to Lm26,721,000 / €62,243,187 and to the doubling of Group’s profit before taxation from Lm487,000 / €1,134,405 to Lm969,000 / €2,257,163.
Listing main reasons for this improved performance, Mr Gera mentioned the increases in sales of beers and beverages throughout the year; a reduction in headcount at the brewery operations; a reduction in selling and administration costs; the further improved results at Quintano Foods Limited; and the reduction in losses in the subsidiaries, Guido Vella Limited and Vita Sana S.r.l.
Mr Gera noted that, in 2006, Farsons’ trading performance improved in an even more competitive market place. “Three years after Malta joined the EU, we can proudly state that our products are competing well. Our market leaders such as Cisk and Kinnie remain strong, and this year we have seen increased interest in both these products from overseas markets. We expect that further export opportunities will grow in the years to come,” he said.
Mr Gera referred to the Board’s decision that, as from this new financial year (2007/2008), an interim dividend will be announced after the six monthly results are declared in September of each year. This new practice will start in September 2007.
He stated that, in view of the improved results, the Board was proposing an interim dividend already declared of Lm75,000 / €174,703, and a final dividend of Lm425,000 / €989,984 bringing the total dividend to Lm500,000 / €1,164,687. Both payments are payable out of tax-exempt profits. This dividend was subsequently approved by the Annual General Meeting.
Finally, Mr Gera thanked all Farsons Group directors, the entire management and staff at the brewery and subsidiaries for their dedication and commitment and all the shareholders for their trust in the Farsons Group.