Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698075418688.pdf (Guyana)
Annual Report and Accounts 1978 Our Corporation's Emblem which appears on the cover of this report is an adaptation of the seal of the ancient Colony of Berbice.

This seal was used during the Dutch period and was taken from a 200-year-old document of the Government of the Colony of Berbice.

The ship displayed in the centre of the Emblem is the type originally used to transport rum between Demerara and Europe.
GUYANA l/OUOR CORPORATION LTD HIGHLIGHTS OF 1978 Sales including duty and consumption tax Pre-Tax Profits Profit after Taxation Go-ossAsseU Shareholders' Funds Dividends Pakl to State Taxation Duty and Consumption Tax Total Direct Payment to State Pre-Tax Profits as% of Sales Sales as% of Gross Assets Pre-Tax Profit n % of Net Assets Pre-Tax Profits as % of Gross Asseu Earnings per share.
1977 - 1977 - $000 50,774 57,176 --- 3,452 9,010 4,581 48,476 14,068 -- 1,793 26,044 26,1137 16.8 117.9 84.1 1,728 -- 38,555 12,397 925 19,766 20,691 = 6.8 131.7 27.8 18.6 9.0 - - -- 29.7r; 11.

1" -- • AdjuSIBd to take account of the capitalisation issue made in 1978.

#i� GUYANA LIOUOR CORPORATION LTO � /.

'{/; :_ .o.nm.,__.
CONTENTS Highlights Statutory Information Statement of value added Chairman's Statement Growth through forward planning Revenue analysis Auditors' Report Consolidated Profit & Loss Account Consolidated Balance Sheet Balance Sheet Consolidated Statement of Source and Application of Funds Notes to the Accounts Three-Year History at a Glance Three-Year History Accounting for Inflation PAGE 3 4 5-8 9-12 19-25 26 27 28 ''\ a: 1; � · GUYANA LIOUOR CORPORATION LTD �( "Z:__1-;� STATEMENT OF VALUE AOOEO ANO ITS DISTRIBUTION FOR 1978 1977 $000 $000 $000 $000 Turnover Deduct: Purchase of Goods and Services TOTAL VALUE ADDED 57,175 19,762 37.413 -- 50,774 22,649 28,125 -- Distributed as follows:- To Central Government Company Taxes Duty and Consumption Tax To Employees Emoluments and Benefits To Suppliers of Capital lnterei;t on Borrowed Funds Dividends to Shareholders Retained for the business Depreciation Retained Profits 4,449 20,595 1,724 18,042 25,044 19,766 1,284 2,350 1,187 2,211 5,337 4,545 964 1,245 3,634 2,209 1,167 438 3,398 37,413 -- 1,605 28,125 = GUYANA LIOUOR CORPORATION LTD STATEMENT BY THE CHAIRMAN It gives me great pleasure to report that the Corporation had an exceedingly good year despite the meny problems and constraints in 1978.
Pre-Tax Profit was more than double that of the preceding year and even exceeded the budgeted profit for the year.

This outstanding performance was due principally to higher salas volume, cost reductions from rigid management controls, additional contributions from the investment programme and the high level of performance achieved by our employees at all levels.
RESULTS FOR THE YEAR: The Group's Pre-Tax profit was $9.010M compared with $3.452M in 1977 - an increase of 161% - quite an achievement for the Corporation.

RETURN ON CAPITAL EMPLOYED: The return on gross assets was 18.6% and on net capital employed 38.1% - a very reasonable rate of return, and compares favourably with that of similar Companies OYerseas.

VALUE ADDED STATEMENT: This is the second year that the raport includes a Statement of Value Added.
This statement is most useful in that it shows the wealth generated by the operations during the year and the way it was distributed i.e.

dividends to shareholders, interest to the Suppliers of loan capital, taxes to Government, wages and salaries to employees and reserves for expansion.

DIVIDENDS: The dividends paid by the Operating Companies totalled $2.350M of which $1.793M was paid to the State.
EXCISE DUTY, TAXATION & CONSUMPTION TAX: The Operating Companies paid to the State $25.044M in Excisa Duty, Consumption and Company Taxes.compared with $19.766M in 1977, which when added to the dividend of $1.

793M, makes a total direct contribution to the State of $26.837M, compared with $20.691M in 1977.
MARKETS: Bulk Rum: There still exists a large oversupply of rum in the Caribbean looking for markets, and it should be noted that a new Distillery became operational in Caricom during the year but had to cease production because it could not find marketrlor its products.

It is heartening to report that despite the savere competition, the Group did well in the bulk trade, increasing their Sales by over 30%.
Our distributors have done a good job in the market place, and the promotional visits of our senior personnel also helped the Group to maintain and increase its share of the market.

In the case of the US Market the import tariff on West l ndian rums is almost four times imported from Europe.
that payable on Scotch, Gins, Vodkas and other spirits lhe US which has a very liberal trading policy towards underdeveloped countries, should re-examine this position, since this tax in our view, is highly discriminatory in nature offering protection to Puerto Rican Rums and a distinct advantage to developed European countries.

It is hoped that the US will take a similar position to that of Canada and Europe by totally eliminating all tariff on West Indian rums.

Caricom: Sales of D.L.L.


's products - Gilbey's Gin, Smirnoff Vodka, Richemond and Bardinet Brandies increased by over 100%.

G.D.L.

's efforts in 1978 have improved considerably and the sales of Booths High & Dry Gin, Cossack Vodka, La France and La Fontaine Brandies, are expected to continue the upward trend in the future.
(i) GUYANA l/llUOR CORPORATION LTO STATEMENT BY THE CHARIMAN (Continued) Export of Bottled Rum: Glass is one of the main elements of cost in the production of rum and since bottles as well as cartons have to be imported and then re-exported with the finished products, the total cost to the buyer makes the product uncompetitive and therefore the distributor's Margin becomes very un•attractive.

It is hoped that this position would change when glass is available from the local Glass Factory later this year.
ACP/EEC: One of the most direct ways in which the developed countries can help the developing ones, is by trade and allowing access in the markets where there is effective demand for products from developing countries such as Rum.

The ACP/EEC negotiations on Rum have started and it is hoped that the Caricom proposals on the whole subject of quotas and definition will be accepted by the EEC and therefore open up markets which exist, but which are inaccessible because of the existing system.
Local Market: G.D.L.

's local rum sales increased marginally in 1978, and this was due principally to the electricity cuts which affected production during the year.

The sale of Booths High & Dry and Blue Seal Gins continued to dominate the Gin Market.

D.L.L's local sales of its Diamond Club Whiskies, franchised products- Smirnoff Vodka, Gilbeys's Gin-and other products, continued their upward trend in this market.

PRODUCTION: Bulk: The Distilleries maintained a high level of production in 1979.
In the case of Diamond, this Distillery operated at full capacity.

Bottled Products: The Power failures had a severe impact on G.D.L.

's bottling production.

Other than this, the Bottling Plant continued to work at full capacity.

In the case of D.L.L.

the Plant is very limited and operated well above its rated capacity.

BULK TERMINAL: The Bulk Terminal was completed in April 1978 at its original budgeted cost despite local and imported inflation.
The first bulk shipment left Guyana on the 13th May, 1978, and the Terminal has been functioning exceedingly well.

In point of fact the Captain of the tank ship remarked during the third shipment that the loading of 262,000 proof gallons in 10'h hours was a record one and the best he had seen to date.

The foresight in building the Terminal is of tremendous benefit as buyers prefer shipment in bulk while it contributes to the profitability of the Operating Companies.
BARREL FURNITURE: The barrel furniture department has improved its range of furniture and I am happy to report that there is now acceptance of the products on the local market, while some exports have been made to Caricom during the year.

Production facility is being stream­ lined and sates are expected to double in 1979.
VINEGAR PLANT: Work commenced on the Vinegar project in December 1977, but because of shortages of cement and building materials, and certain other difficulties the Plant which was scheduled to start operations late last year, became operational March 1979.

A new Company - Demerara Food Products-was incorporated to take over this operation.

The Plant has a capacity of 238,000 gallons, which is adequate to supply the local market and also to provide export potential for the product.
It is hoped to add pickled food products to the range of products produced by this Company in 1980.

OTHER PROJECTS.

(a) Winery: The Winery will be located at Diamond and table wines are expected to be on the market in the latter part of 1979, as ageing and shelf life are now being tested to ensure that the product is consistent and of a marketable quality.
GUYANA LIOUOR CORPORATION LTD ·• � .• JP =----------------------, STATEMENT BY THE CHAIRMAN (Continued) lb) Bottling Plant: The installation of a new Bottling Line is now underway at G.D.L., Water & Schumaker Streets, and this will enable the Company to supply the needs of the Local, Caricom and International Markets.

Finance for this project has already been obtained and the project should be completed by July 1979.

The G.D.l.
The G.D.l.

semi-automatic Line is being transferred to Diamond and this is expected to be completed by July 1979.

This will give Diamond the necessary capacity to produce its franchised products and Diamond Club Whiskies so higlly in demand in the Caricom and Local Markets.

le) New Still at Diamond: The No.

2 Still at Diamond is obsolete, and a new one is being installed at a cost of over $3M.
This Still will give Diamond the flexibility of producing other types of spirits which are in demand in the world market, and will also be capable of pro­ ducing neutral alcohol to meet the Group's requirements of franchised products.

Id) Modification to the No.

2 Still at Uitvlugt: In order to make Uitvlugt Distillery more flexible in the types of spirits it produces, a new Column would be added to the No.

2 Still, and this is expected to be completed by the end of June 1979.
This would ensure that this Still produces the types of spirits in demand in the International Market, thus resulting in a higher degree of utilisation.

le) Yeast: The Group has been able to obtain a contingent loan of US$53,000 to purchase a Pilot Plant and provide the expertise in the production of Yeast.

Research in this area is continuing for the production of Yeast for human and animal consumption, and it is hoped that production will commence in the latter part of 1981.
(fl Cosmetics: In order to avoid duplication of efforts, the Guyana Pharmaceutical Corporation has taken over the Cosmetics Projects but the Corporation intends to continue to carry out studies in the production of alcohol based types of products for cosmetic usage.

(g) Seals and Corrugated Cartons: (h) The Caribbean Development Bank hes indicated that it is quite prepared to finance the Seals and Corrugated Cartons project for the production of pilfer-proof Seals and Corrugated cartons.
A feesibility study has been submitted to the Caribbean Development Benk and from all indications, the project will be approved, and should get underway early in 1980.

Food Products - Black Bush Polder: One of the Operating Companies - Diamond Liquors Limited has been marketing in Caricom, Jams, Jellies and Guava Cheese.

These have been well received and a market exists for these products in Caricom and locally.
The Company intends to move forward in this direction, and with this in mind the Corporation has acquired the Plant at Black Bush Polder which was originally intended to produce Tomato Ketchup.

The Corporation intends to use the Plant for the production of Guava Jellies, Jams, Fruit Juices and other preducts which can be produced from agri­ cultural produce available in the Black Bush Poitier area.
(i) Bond and Whalf - New Amsterdam The Corporation has also acquired the Transport & Harbours Bond and Wharf facilities at Stanleytown, New Amsterdam.

This facility is in a state of disrepair and a rehabilitation programme is underway.

When completed, the Bond will be used for the storage of alcoholic products in order to give a better service to the East Berbice region and will also be used as a storage area for the products from the Black Bush Polder.
GUYANA LIOUOR CORPORATION LTD STATEMENT BY THE CHAIRMAN (Continued) Iii Power Alcohol: In October 1978 a team of three experts arrived from Brazil, as guests of the Corporation to undertake a feasibility study on Power Alcohol.

They visited all the major sugar estates and the three distilleries.

A Preliminary Report was recently submitted by the Team.
It should be noted however, that in the last few months, the cost of molasses - the basic input for the production of alcohol has more than doubled in price, and this trend is expected to continue for the next 18 months.

The Brazilian Government Team is now working on a detailed feasibility study on the Project.

A Technician will be sent for training on Cars operating strictly on power alcohol, and on his return to Guyana, the Brazilian Government will donate 3 vehicles, fully powered by alcohol.
ACCOUNTING FOR INFLATION: On page 28 is a statement showing the effects of inflation on the Corporation results.

This Statement shows the impact in replacing assets at current day values which if totally ignored, may result in over-payments for services rendered, underpricing of products and over-distribution of dividends, thus adversely affecting future prospects of the Company in a competitive world.
FINANCE FOR EXPANSION: The Corporation has gained the confidence of the Banking system both locally and internationally, and finance for most of the projects has already been obtained.

PROSPECTS: Based on firm orders for bulk rum in 1979 and the marketing and production of other products, prospects for 1979 seem very promising and the results are expected to exceed those of 1978.
Promotional visits overseas would have to continue at the highest level and I am happy to report that the visit by Minister Kennard and I to Europe has been very successful as volume sales are expected to be greater in 1979.

Employees at all levels in the Operating Companies played their part under very difficult conditions in 1978, and it is hoped that this would continue into 1979.
Severe com­ petition is expected to continue in the markets; in addition, costs are expected to rise steeply because of imported and local inflation.

We can therefore only stay in business by producing a quality product at a competitive price and this could only be achieved by greater efforts on the part of all employees, by means of higher production and greater efficiency through improved productivity thereby reducing unit cost and improving overall profitability.
Finarly, providing there are no major constraints or problems, and the team spirit of employees continues, the profit for 1979 should be well above that of 1978.

ACKNOWLEDGEMENTS: I would like to thank our employees at all levels for the contribution they made during the year, the Board of Directors and our Minister of Agriculture Cde.

Gavin Kennard for their continued support and guidance, and above all, our customers at home and overseas without whose support these results would not have been possible.
Yesu Persaud Chairman -� GUYANA LIOUOR CORPORATION L TO �. '

GROWTH THROUGH FORWARD PLANNING In an aver increasing search ta inprove our preduct and service ta eur Customers, the Corporatien underteek a comprehensive market research in 1976.
Out af this research it was clearly ebvieus that our method ef 'packaging' (barrels) far export was not enly 'aid fashiened' but costly ta the buyers thus making it impessibla for us te effer attractive prices in e cempetitive markeL Handling and Ocean freight contributed signifi· cantly te tha final cost - hence e new distribution system became imperative.

With eur eyes on the future, and our cem:ern fer our custemars, eur "Bulk Terminal'' became a reality.
The varieus blends el eur spirits are now movad frem eur various distilleries te our Bulk Tarminal.

This is located en the Eastam Bank ef the Damorara River, in G111rgetown - tha prin· cipal port ef Guyana - thus previding ready accea to tha Bulk Tankers wh ich are now used in our distributiva netwerk.

But of this entire axari:isa wa were abla te retain our markets, improve eur oporating efficiencies, and effect 111Vings within the group.
A Road T enk W1111on being prepared for dlschlrge into the Bulk Tennlnal.

The M. T. Proof Treder being IOllded with the third Bulk Shipment for export.

An exterior photo of tha entire Vinegar Complex constructed by our personnel.

An interior view of the Plant showing the acetifiars ( Fermenting Vessels) and storega Vats used in the manufacturing procass.

GROWTH THROUGH FORWARD PLANNING Continued VINEGAR PLANT Included in our plans for the future is a diversi­ fication programme.
Under this programme a Vinagar Plant was installed at Enmore - adja­ cent to the Distillery.

The building was con­ structed by our technical personnel, and houses a laborntory for quality control along with equip­ ment with capacity to produce 238,000 gallons The fermenting & storaga vessels were built by our coopers from greenheart wood.

Spirit Vinegar is now produced for the first time in Guyana.
This provides a new outlet for the spirits from Enmore Distillery as well as creates new technology, and saves valuable foreign exchange while at the same time ensures our customers locally and over­ seas of a product with high tnternationet standards GROWTH THROUGH FORWARD PLANNING Continued The Plant wn officially opened on February 19, 1979 by the Hon.

Prime Minister ef Guy ... L F .S.


Burnhlffl - whe is 181n unveiling the plaqut ta commamaratt tht op1ni111 canmony Our Supplier of the equipment used in the manufacturing proclG is Heinrich Frings GMBH & Ce.

KG of Germany, In picture the Prima Minister turns the switch to sat the precess in motion - while tht Supplian's rapl'INntttivt and the Cerperation's E111inNr loak on.
Aftlf Vinapr is produced, plSlturiad and filttrld it is bottled and labelled 111 1'91tl in twe sim - 16 ozs and 32 on for distributien tt Consumen.

GROWTH THROUGH FORWARD PLANNING Continued BARREL FURNITURE Rums ware traditionally shipped in barrals, but with tha intraductian of aur Bulk Tarminal (saa page 9 ) it becama nacassary far us to provide alternativa employ­ ment far our caopars - and at the sama time utilise tha axcass barral stocks on hand.
Thair specialised skills ware c hannelled into tha pro­ duction of a unique range of barrel furniture, fer the local and export markeu.

BASIC EXPANSION While wa have embarked on a pregremma of divarsification, our traditional areas el preductien are still under canstent reviaw, in an effert te keep apace with market demands.
A cemplately new Still is to ha installed at Oiamend r&placing an abselate ene,and enabling this distillery ta maet its damands for Neutrel Spirits, while at the same time axpanding its range of spirits.

An additional Column will alse be addad to tha Ne.

2 Still at Uitvlugt Oistillary, providing greater flexibility in the range el spirits this Still can praduce.
Tha 'Oeuble Pot Still' tram Versailles which preduces rum with peculiar characteristics has baen transferred ta Enmore distillery and completely reconditioned.

Expansion and improvamanu are also taking piece en the Battling Lines of beth G.O.L.

& O.l.L.

Coopan at wark damanstrating th air 1kiU1 in this naw and unique am of productian.

Th1 nawty racanditioned 'Oaubla Pat Still' ovw 150 yaan old now located at Enm are Distillery.
This is ona of tha Original Oamarara Rum type Stills - 11 we centinua to bland the aid with tha n,w.
12 ·, GUYANA l/OUOR CORPORATION LTD GROUP REVENUE ANALYSIS (SALES: 100%) 1978 1977 Materials (38.2%) 13 """ a: GUYANA LIOUOR CORPORATION LTD '.lJ,iiiilJll REPORT OF THE AUDITORS To the Memben of Guyana Liquor Corporation Limited We have examined the accounts set out on pages 15 to 25 which are in agreement with the books of the Company and have been prepared under the historical cpst convention, including the re-valuation of the fixed assets as explained in Note 8 on page 22.
We have obtained alt the information and explanations we have required.

In our opinion these accounts give, under the accounting convention stated above, a true and correct view of the state of affairs of the company and group at 31 December 1978 and of the net income and source and application of funds for the year then ended, in accordance with generally accepted accounting principles applied on a bas is consistent with that of the preceding year.
THOMAS, STOLL, DIAS & CO Certified Accountants 5 America Street, Georgetown.

Guyana 27 March 1979.
14 GUYANA L/OUOR CORPORATION LTD CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 1978 Turnover including excise duty Profit before interest and taxation Interest Profit before taxation Taxation Net Profit after taxation Minority Interest Net Profit attributable to the Group Dividends Retained Group Profit for year Retained Profit at 1 January Retained Profit at 31 December Earnings per share Notes 1977 $000 $ 29.7C 11.1 t 15 GUYANA l/OUOR CORPORATION LTD CONSOLIDATED BALANCE SHEET AT 31 DECEMBER, 1978 Notes $000 $000 $000 $000 1977 8 9 10 FIXED ASSETS INVESTMENTS FORMATION EXPENSES CURRENT ASSETS Stocks and Work-in progress Debtors and Prepayments Investment - Treasury Bills Cash on hand and at bank CURRENT LAIBILITIES Creditors and Accruals Loans due within 12 months Proposed dividends Taxation Bank Overdraft NET CURRENT ASSETS FINANCED BY Share Capital: Authorised 15,000,000 (1977-8, 123,284) Ordinary $1 shares Issued and fully paid 11,427,086 (1977-5,713,543) ordinary $1 shares Capital Reserves Retained Earnings 11 SHAREHOLDERS FUND S Minority Interests Deferred Taxation Loans due after 12 months Pension Provision 12 10 20,355 18,996 77 27 77 25 16,113 8,208 2,045 1,650 28,016 8,765 2,791 1,793 3,077 5,026 12,Q94 6,016 1,347 19,457 6,337 3,454 784 527 3,480 21,452 14,582 6,564 27,023 -- 15,000 --- 11,427 146 2,485 14,058 5,392 1,106 6,403 64
 27,023 --- 4.875 23,973 8,123 5,714 5,802 881 12,397 4,553 824 6,126 73 23,973 --- 16 GUYANA l/OUOR CORPORATION LTD BALANCE SHEET AT 31 DECEMBER, 1978 Note, $000 $000 $000 $000 ••n 73 1, 166 2,045 874 4,158 404 594 1,793 12 2,803 FIXED ASSETS 8 INTERESTS IN SUBSIDIARIES 13 FORMATION EXPENSES CURRENT ASSETS Debtors Dividends Receivable Investment - Treasury bills Cash on hand and at bank CURRENT LIABILITIES Creditors and accruals Loans due within 12 months Proposed dividends Bank overdraft 10 NET CURRENT ASSETS (LIABILITIES) FINANCED BY Share capital Authorised 15,000.000 (1977-8,123,284) ordinary $1 shares Issued and fully paid 11,427,086 (1977-5,713,543) ordinary $1 shares Capital Reserves 11 SHAREHOLDERS FUNDS Loans due after 12 months 10 308 14,038 17 196 7,281 25 942 1,390 577 6 1,446 1,365 15,718 = 15,000 -- 11,427 84 11,511 4,207 15,718 (56) 7,446 -- 8,123 -- 5,714 5,714 1,732 7,446 -- Y Persaud R.D.
Webster Directors 17 � ' ;a· GUYANA l/DUOR CORPORATION l TD .
-�11� � CONSOLIDATED STATEMENT OF SOURCE AND APPLICATION OF FUNDS FOR 1978 $000 $000 $000 $000 1977 7,846 2,990 SOURCE OF FUNDS Profit before taxation less minority interests ,6,djustments for items not involving the movement of funds: Formation expenses Depreciation Minority interests in retained profits for the year 8 1,186 829 TDTAL GENERATED FROM OPERATIONS 9,869 10 1.167 197 4,364 6 24 3,838 8,232 6,806 1,426 462 1,540 {404) 784 1,618 2,557 3,454 9 10 BO 3,068 13,017 8,432 4,585 4,019 2,192 (2,428) 77 778 2,431 2,741 770 9 --- 2,045 303 (1,546) 917 (1,089) I 802) 4,585 (172) - -- 1,426 FUNDS FROM OTHER SOURCES Net Proceeds on sale of fixed assets Proceeds-on sale of investments Loans APPLICATION OF FUNDS Investments Dividends paid Tax paid Purchase of fixed assets Loan repayments Pension Formation expenses INCREASE IN WORKING CAPITAL: REPRESENTED BY: Increase in stocks and work-in-progress Increase in debtors and prepayments Increase in creditors and accruals Movement in net liquid funds: Investment - Treasury bills Increase in cash balances Increase in Bank Overdraft 18 -�r �,, �-v,.
I, "� to GUYANA LIOUOR CORPORATION LTD f<� �lii;;.

;u,� NOTES TO THE CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED 31 DECEMBER 1978 1.

ACCOUNTING POLICIES (a) Basis of Consolidation (i) The consolidated accounts incorporate the accounts of the company, the consolidated accounts of the subsidiaries, Guyana Distilleries Ltd., and Diamond liquors Ltd., and the accounts of subsidiary.

Demerara Food Products Ltd. Demerara Food Products ltd., did not commence trading in the financial year.
its (ii) All inter company balances and transactions are eliminated on consolidation (b) Depreciation No depreciation is provided on freehold land and construction work in progress.
Other fixed assets are depreciated on the straight line basis over their estimated useful lives as follows:- Freehold building Plant and machinery - Distillery Plant and machinery - Others Office Equipment Furniture, fixtures & Fittings Sundry equipment Vehicles 2% 6'A.% 7'h% 12Y:.% 10% 20% 25% (cl Stocks, Stores and work.In-progress Stocks and stores are valued at the lower of cost and net realisable value.

Cost includes insurance and freight.


Unsold produce of Guyana Distilleries Ltd., are valued at the net selling price for firm export orders received, and for local sales at cost of production including direct overheads.

Work-in-progress at cost of materials and direct overheads.

is valued (d) Deferred Ta xation Deferred Taxation is provided at current rates on the amount by which the book values of these assets which qualify for tax allowances exceeded their written down values for tax purposes.
(e) Foreign Currency Translation Foreign currency transactions are converted to Guyana dollars at the rates of exchange ruling at the dates of such transactions .

A t balance sheet date all amounts denominated i n foreign currencies are translated to Guyana dollars at exchange rates ruling at that date.

Gains and losses arising from the translation of foreign currencies are included in net profit.

Formation Expemes (f) Formation expenses are written off over a period of five years.
(g) Currency These accounts have been prepared in Guyana dollars.

19 (i:· GUYANA LIOUOR CORPORATION LTO NOTES TO THE ACCOUNTS (Continued) 2.

TURNOVER Turnover represenu the value of goods and services sold to third parties.

PROFIT BEFORE INTEREST AND TAXATION 3. is arrived at after accounting for: Depreciation Directors' remuneration Auditors' remuneration (Gain)/Loss on sale of fixed assets Unrealised exchange (gain)/loss INTEREST 4.
On secured loans Dn unsecured loans and overdraft Less interest received 1978 1977 $000 1,186 1,167 17 46 (48) 140 1,234 1,374 90 1,284 21 49 16) 31 93 943 1,036 72 964 � 20 GUYANA l/OUOR CORPORATION l TD NOTES TO THE ACCOUNTS (Continued) 5.

TAXATION Taxation charge based on profits for the year is made up as follows:- Income and Corporation Tax@ 45% Property Tax Deferred Tax Prior year adjustments 6.
DIVIDENDS Paid Proposed 1977 1978 $000 $000 4,031 138 282 4,451 12) 1,398 115 171 1.684 40 4,449 -- = 1,724 1,793 141 784 1,793 925 = = 7.

EARNINGS PER SHARE This is based on the net profit attributable to the Group divided by the ordinary shares Issued and fully paid at the end of the vear.
The earnings per sh are for the previous y ear was adjusted to take account of the capitalisation issue calculated as follows:- Net Profit attributable to Group Ordinary Shares of $1 each issued and fully paid Earnings per $1 Share in cents 1977 1978 $000 $000 3,397 11,427 29.7 1,266 11,427 11.

1 21 /�- ('-- ·, rt · .-----..,..."

(IP GUYANA LIOUOR CORPORATION l TD NOTES TO THE ACCOUNTS (Continued) 8.
FIXED ASSETS Groue Equip- Lands and Buildings _., Total Company Equip lands and Buildings -·· Toul $000 $000 $000 $000 $000 $000 138 7 (921 53 53 53 10 9 83 228 221 235 1921 311 364 311 311 364 364 15 22 25 31 Cost or Valuation At 1 January 1978 Additions Revaluation Disposals At 31 December 1978 11,915 267 66 (75) 12,175 2,290 12,627 24,542 2,557 68 (921 (171 14,900 27,075 6,435 5,740 6,435 14,900 20,640 12,175 14,900 27,075 422 231 5,124 5,546 955 1,186 (121 (121 Comprising Valuation Cost Accumulated depreciation A t 1 January 1978 Provision for year Retired on Disposals At 31 December 1976 Net book values At 31 December 1978 At 31 December 1977 653 6,067 6,720 19 37 56 11,522 8,833 20,355 34 -- = -- 274 308 11,493 7,503 18,996 196 128 68 �- -- -- The Freehold Lands and Buildings of Guyana Distilleries Limited were revalued on 9 December, 1974 and those of Diamond liquors Limited were revalued on 31 December, 1977 in accordance with professional advice to reflect market values.
Certain equipment acquired by Guyana Distilleries Limited during the year were revalued by the Directors to reflect current market values.

The surpluses created from these revaluations have been transferred to capital reserves which has sin ce been partly utilised to issue bonus shares.

22 NOTES TO THE ACCOUNTS (Continued) Gn,up 1978 1977 $000 $000 $000 $000 1977 1978 i:o-ny 9.
INVESTMENTS Guyana Distilleries (Canada) Limited 10 Shares at C$100 each at cost 3'1..% Guyana National Defence Bonds rvdeemable in 1987.

2 75 77 10.
LOANS la) Offshore loan (US$.23M) from lb) Barclays Bank International Ltd. guaranteed by the Government of Guyana, re-paid in June, 1978 Local loan from Barclays Bank International Ltd. secured with interest rates at 9% and repaid in quarterly instalments of $90,000 2 75 77 590 90 1,1 Offshore Joan (US$2.6M) from Guyana State Corporation repay· able in 3 equal annual instal- ments commencing 19 September, 1978 ldl Offshore loan (US$.9M) from Royal Bank of Canada repayable in four equal annual instalments commencing 31 December, 1978 le) Offshore loan (US$1.132MI from Royal Bank of Canada repayable in 6-semi annual instalments commencing April, 1981 Ill Finance for Capital Goods from Lloyds Bank Ltd. through Guyana National Co-operative Bank repayabJe in 10 half-yearly instalments commencing 25 October, 1979, Repayments due in 1979 classified as current liabilities Repayable after 1979.
4,393 6,591 1,732 2,309 1,732 2,309 2,905 2,905 164 164 9,194 9,580 4,801 2,309 2,791 3,454 594 577 6,403 6,126 1,732 4,207 --- � � 23 GUYANA l/OUOR CORPORATION LTD NOTES TO THE ACCOUNTS (Continued) Group Company t978 1978 1977 $000 $000 $000 1977 $000 11.
CAPITAL RESERVES At 1 January Revaluation Surplus, less minority interest 5,802 3,975 58 1,827 Revaluation of Shares in Guyana Distilleries Limited Capitalised by the issue of one bonus share for each share held At 31 December (5,714) 146 5,802 5,798 (5,714) 84 12.

MINORITY INTEREST Ordinary S hare Capital Reserves Dividends Proposed 2,784 2,246 362 5,392 2,784 1,629 140 4,553 13.
INTEREST IN SUBS10IAR1ES Ordinary Shares held in Diamond Liquors Limited 2,364,984 Shares of $1 each at cost Guyana Distilleries Limited 6,601, 150 Shares of $1 each at valuation Amount owing by:- Diamond Liquors Limited Guyana Distilleries Limited Demerara Food Products Limited Seals and Packaging Industries Limited 2,600 2,600 8,912 3,114 11,512 5,714 1,170 397 1,421 777 320 8 14,038 7,281 The shares in Guyana D istilleries Limited were revalued by t he Directors at $1.35 each and the sur plus arising ther efrom was transferred to capital reserves.
(Note 11).

24 GUYANA l/OUOR CORPORATION LTD NOTES TO THE ACCOUNTS (Continued) 14.

CAPITAL EXPENDITURE Authorised by the Directors and contracted for Authorised by the mrectors but not contracted for 16.

CONTINGENT LIABILITY Bonds in respect of duty on spirits warehoused and exportation of goods Guarantee in respect of borrowing of other parties Bonds in respect of duty on goods imported under the Industries aid and Encouragement Act C,apter 96:01 16.
PARTICULARS OF SUBSIDIARIES Nam• of Comp11ny Diamond Liquors Limited Guyana Distilleries Limited Oemerara Food Products Limited Country of R-.

;stration of Incorporation Guyana Guyana Guyana Group ,an 1978 $000 $000 $000 $000 ,an 1978 Com,-ny 3.935 972 3.982 6,103 180 972 60 2,195 2,195 62 26 37 467 269 467 269 Identity of Heh Proportion of -- Cl-oflh- ..... hefdbytlw .... 2.364.964 ordinary shares of $1.00 each 6,601,150 ordinary ahares of $1.00 each 260,000 ordinary shares of $1.00 each.
being held in equal amounts by the above subeidiaries Group 63.1% 82.6% 72.8% 26 �(: (I�:: GUYANA LIOUOR CORPORATION LTD THREE YEAR HISTORY AT A GLANCE $M "' "' "' " " ' $M ' 6 , ' SALES nM •= "M PROFITS '" RETAINED PRDFoTS "n ,on 1 .. TEREST � ""��" I��,} GUYANA LIOUOR CORPORATION LTO ��i<� THREE-YEAR HISTORY Sales Operating Profit Interest Profit Before Tax Taxation Profit After Tax Gross Asseu Employed Capital Employed Shareholders' Funds Operating Profit as% of Sales Operating Profit as% of Capital Employed Return of Gross Assets Return on Share holders' Funds 1977 1976 $000 $000 45,796 50,774 4,113 798 3,315 1,557 1,758 4.416 964 3,452 1,724 1,728 1978 $000 67,175 10,294 1,284 9,010 4,449 4,561 31,123 20,168 10,229 38,555 23,973 12,397 48,475 27,023 14,058 % % % 9.0 20.4 10.7 30.0 8.7 18.4 9.0 20.3 t t 18.0 38.1 18.6 47.6 t Earnings per Share" 29.7 Shareholders' Funds per Share 123.0 • Earnings per share have been adjusted to take account of the capitalisation issue of 11.1 217.0 11.8 179.0 one bonus share for each share held.
27 """""'-"'iii: �{ft.,,._ GUYANA LIOUOR CORPORATION LTD f<�.t �:�7 ACCOUNTING FOR INFLATION The purchasing power of money continues to be eroded by inflation, and conventional accounting methods do not measure such reduction in the value of money.
While there has been no consensus on a common method of Accounting for Inflation, despite various proposals and recommendations which have been put forward, the Company recognises the need to give memben an indication of the effects of inflation on its oper ations.

In the 1977 Report the Company presented an adjusted Profit and Loss Account and Balance Sheet showing the effectl of inflation on replacing its fixed assets and stocks.
In this Report we set out below a statement outlining the adjustments to historical costs, profit arising from tha increasing replacement costs of Fixed Assets and stocks and the reduction in real value of the liability of the Company.

This statement is prepared on the basis of the interim recommendations of tha Accounting Standards Committee of the United Kingdom.
sooo sooo Tu...,.. Profit before tax as in historical costs accounts Adjustments - depreciation (Note 1) - cost of ules (Note 2) 2,148 � 2,794 - less gearing (Note 3) Current cost profit before Taxation Taxation Profit after Taxation Minority Interest Profit attributable to the Group Dividends Retained Profit (Loss) -= 67,175 9,010 1,634 7,476 4449 3,027 __J.§9.. 2,256 1,793 486 1977 $000 $000 50,774 3,452 2,022 476 2,498 1,122 l ,376 2,076 ----12� 352 _ ___l_l 281 (644) (1) Dlpreaiation: Fixed assets are revalued at the estimated replacement costs which are used to calculate depreciation.
(2) c.t of Sain: Cost of Sales have been adjusted to reflect average current cost of stocks consumed during the peried.

131 GNri .. : This adjustment is the net gain from holding monetary liabilities aft9r allowing for the change in the value of money.
28 �·c� .fa·, GUYANA LIOUOR CORPORATION LTO � • COMPANIES THAT MAKE UP THE GROUP GUYANA LIQUOR CORPORATION LIMITED Head Office and Administration Bulk T erminal DIAMOND LIQUORS LIMITED Administration, Distillery and Bottling Plant Shipping and Customs GUYANA DISTILLERIES LIMITED Administration, Botti ing Plant and Warehouse Cooperage and Stores Pist.m�ry DEMERARA DISTILLERIES LIMITED Distillery Administration DEMERARA FOOD PRODUCT S LIMITED Vinegar Plant Food Processing Plant Administration 61 Avenue of the Republic Georgetown 8/11 Water Street Georgetown.
Diamond East Bank Demerara 61 Avenue of the Republic Georgetown.

8/11 Water Street Georgetown La Penitence East Bank Demerara UitvluC3t 'W·C.'D.

Enmore East Coast Demerara B/11 Water Street Georgetown.

Enmore East Coast D emerara Black Bush Polder Corentyne Berbice.

61 Avenue of the Republic Georgetown.