Grace gets container contract reprieve

By McPherse Thompson, Staff Reporter

Orane

THE PORT Authority of Jamaica has extended Kingston Terminal Operators' (KTO) management contract of the Kingston Container Terminal to October 31, this year, according to chairman and chief executive officer of Grace, Kennedy and Company, Senator Douglas Orane.

The management contract being held by Grace's subsidiary, Kingston Wharves, expires on July 31, this year, but Senator Orane said that by mutual agreement with the Port Authority, the existing agreement would continue for the additional period.

At the same time, Senator Orane said, "we have responded affirmatively to the Port Authority's advertisement requesting expressions of interest in the new management contract for Kingston Container Terminal."

He was addressing shareholders at Grace, Kennedy and Company's annual general meeting at the company's Harbour Street, downtown Kingston offices on Monday.

Asked why he believed that Kingston Terminal Operators should win the new contract, Senator Orane told Wednesday Business: "We are world class in our management skills. We have familiarity in dealing with international customers calling here for the past 25 years. We have experience in maritime management. We are unique and a Jamaican company that has international experience. In terms of the nature of the Jamaican market, we have demonstrated the ability to work with international allies who can provide us with the input that we require."

Confident

Asked how sure he was that they would retain the contract, Senator Orane said, "very confident, because we believe ultimately Jamaicans will support a Jamaican company that has demonstrated world class in this service."

Kingston Wharves' chief executive officer, Anthony Barnes, seeking to justify why the company should be awarded the new management contract, said "we are the original managers of Kingston Container Terminal. In our first year of operation in 1975 we did 27,000 TEUs (20-foot equivalent units) and this year we'll do just short of a million TEUs, a growth rate of about 20 per cent per annum.

Skills

Mr. Barnes said the Port Authority "had to have had our skills to make that happen. We have gone from one crane to 14 cranes - by the end of this year - and we've been through all the growth pains and organisation to bring it to the level it is now. Our productivity rates compare with the top half of container ports in this hemisphere, in Europe, North America, and we are in the top half of their performance.

We are currently adding more modern equipment. We have hundreds of our people trained both locally and overseas. At least 45 of our people were sent overseas for training courses, obtaining certification both in practical and theory. I compete with ports in the Bahamas, Miami, Panama, etc."

During Monday's annual general meeting, Senator Orane said that although KTO has made a written expression of interest to the Port Authority, negotiations were also taking place to see how a merger of Kingston Wharves and the Kingston Container Terminal could take place.

On Grace, Kennedy's financial results, Senator Orane said that for the first quarter of 2001, net profit attributable to shareholders increased by more than 35 per cent over the corresponding period in 2000, moving from $161.3 million to $218.8 million, in large part as a result of the rebirth of the company's food distribution business. Further-more, he said, the company's stock price increased from $17.95 to $25 since the start of the year, an increase of 39.3 per cent.

Among other things, sales of ackees in the United States since the lifting of entry conditions have resulted in a 24 per cent first quarter growth of Grace-owned brands in the international marketplace, he said.

The company's performance was also boosted by the opening of Air Margueritaville restaurant at the Sangster International Airport in Montego Bay, with initial response from consumers exceeding expectations, Senator Orane said. The business is a joint venture with Versair In-Flite Services and Montego Bay-based entrepreneurs Ian Dear and Brian Jardim in collaboration with internationally-acclaimed singer Jimmy Buffet.

Joint venture

Senator Orane said Grace, Kennedy's business has also been enhanced by a venture-capital type investment through a joint venture with Goddard Enterprises of Barbados to become the exclusive Nissan distributor in Jamaica. This is being done through a newly-created company called Fidelity Motors in which Grace has a minority interest and which will be managed by the Goddard group. Fidelity Motors started operations in mid-May from its Hanover Street location in Kingston.

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