Difficult year but board is confident

CI TRADERS has had a demanding year. In its annual report ending January, chairman Tom Scott said the company had demonstrated its resilience in what was 'a time of quite widespread poor trading conditions in our principal markets'.

Safeway, in particular, 'had a very difficult summer thanks to unwarranted calls for customer boycotts', he said.

The store, which has remained independent of the company's retail outlets since its purchase in April 2005, suffered a 'commensurate fall in sales' in the early months. Mr Scott also attributed this loss to the discontinued supply of Morrisons own-brand goods.

He confirmed trade at Safeway was recovering and that the company was committed to keeping the premises as a distinct retail store.

CI Traders also wrote off the 'substantial costs' incurred over the failed casino bid at St Pierre Park.

Despite that, group pre-tax profit rose by 3.4% to £15.2m. and turnover by 11% to £326.11m.

However, net debt increased by 15% to £202.8m., which is expected to be cut using proceeds from property assets sold over the course of this year.

'We are comfortable that the level of borrowing at the year end will be sharply reduced in the first half of the new financial year from asset realisations,' said Mr Scott.

The group sold its UK-based restaurant chain, Blubeckers and Edwinns, for £25m. in June last year.

In relation to recent taxation issues affecting both islands, Mr Scott said a united policy by Guernsey and Jersey would be beneficial for companies both on and off the islands.

While acknowledging the cultural differences between the two Bailiwicks, he said a divided approach to taxation might lead to companies using the opportunity to trade one island off against the other.

'As a resident, I greatly appreciate the unique aspects of the islands that make them such fascinating communities.

'However, as a businessman I dearly wish that they would remember they are also major shareholders in ?Channel Islands Ltd? and take advantage of the many opportunities that their combined strength could bring them.'

Mr Scott was encouraged by the efforts that both Bailiwicks were making in attempting to regenerate the dwindling tourist industry.

He said prospects for the growth of CI Traders were good.

'All of our businesses are full of potential for growth in value and your board is confident that the business plans that management have prepared and are now implementing will produce considerable benefit for the company's various stakeholders.'