Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698075542209.pdf (Guyana)
GUYANA SUGAR CORPORATION INC.
ANNUAL REPORT 2010 Table of Contents Financial Matters Environmental Matters Agriculture Operation Factory Operation Corporate Social Responsibilities Markets National Contributions Production figures Board of Directors Report of the Directors Report of the Auditor General Report of the Chartered Accountants Consolidated Statement of Financial Position Statement of Comprehensive Income Consolidated Statement of Changes In Equity Consolidated Statement of Cash Flows Notes to the Financial Statements A A A B B C C D E F ii 1(a) Financial Matters Low productivity due to unfavourable weather conditions, challenging industrial relations, and rising costs, as well as extended crop periods in striving to achieve production targets direly impacted the Corporation’s cash flows throughout the year, challenging the industry to better manage inventory levels; source more cost effective materials and services while maintaining quality; maximize on the credit terms from suppliers; negotiate better contracts with customers in terms of reduced credit periods while still being competitive; follow up on timely collection of debts; and even in some instances provide incentives to customers to pay in advance.
Monthly meetings with the Estates’ Finance Managers commenced in the latter half of the year due to dual reporting lines to both the Estates and Head Office established in 2009.

These meetings targeted improvements to financial controls and measures.

For 2010 the overall average rates of exchange achieved did not vary significantly from anticipated and so did not have a major impact on the revenues achieved.
The EU/US$ rate was down slightly by 0.005 points from the estimated rate of US $1.410 to €1 and the average US$ / G$ rate was down only 0.981 points from the estimated rate of G$ 204 to US$ 1.

The Revenue for 2010 was G$26.2 bln, compared with G$32.0 bln, a decline of G$5.8 bln (18.125%) Environment Matters The Corporation continues to take actions that will contribute towards good stewardship of the Environment.
These actions include, but not limited to sustainable Agriculture, Water Conservation, usage of Biological Herbicide and Weedicides for the field operations.

The Corporation spends a significant portion of its financial resources towards drainage and irrigation, which have a direct impact on the country’s water management system.

These actions are done throughout the Coastal areas on a daily basis by the Corporation’s employees.
A special water management meeting was held at Blairmont in January in preparation for the first crop of 2010.

Each Estate presented its water management strategy to mitigate the effects of the El Nino conditions.

These strategies were successfully implemented during the first crop.

NDIA was of great assistance to GuySuCo in providing mobile pumps for pumping water from the conservancies and from the Kamuni Creek for the Demerara Estates during the dry spell.
Agricultural Operations The year 2010 was one with many challenges for Agriculture Services.

Loss of skills during the year outnumbered the recruitment process; this made it quite difficult to readily satisfy the needs on some locations.

Despite the many difficulties there was a definite improvement in providing services to the estates when compared to last year.

A The Agriculture Engineering Research Department was merged with the Agriculture Services Department.
With the continuous drive to mechanize the Industry, this restructuring would be very beneficial.

Although cash flow in the Industry was not as fluid as budgeted, procurement of Agriculture supplies was not compromised.

There was no shortage of Fertilizers and Agrochemicals during the year.

Despite the aged machinery fleet, which was used for the greater part of the year, all efforts were made to procure spares in a timely manner to maximize on availability.
Factory Operation Sugar production for 2010 totaled 220,818 tonnes, representing 84% of the target of 264,091 tonnes.

Labour shortages and unfavourable weather conditions resulting in factories being out of canes were the main reasons for the reduced production.

Blairmont factory’s performance was the best, achieving 91% of its target.

Skeldon continues to improve on its production surpassing 2009’s actuals.
Where in 2009 there was a reduction in production at LBI and Wales over the previous year, the factories were able to maintain its level of production in 2010 in spite of the difficulties faced in the year.

Time loss due to strikes reduced in all estates when compared to 2009 except for Blairmont and LBI; however time lost due to out of canes increased on all estates except for Wales.
Corporate Social Responsibilities As part of the Corporation’s passion to contribute to the nation as a Corporate Citizen, it continues to give back to the communities in the areas that it operates therein.

The Guyana Sugar Corporation has been engaged in the ethical perspective of the Corporate Social responsibility for several decades.

It sees itself as a giver to the community that it operates in, since many of the persons that it employs are residents of the community.
These are some of the things that the Corporation continues to do for the communities wherein it operates:  Provides medical services for the extended family members of any employee in the community  Uses its Water tender to assist in the event that there is fire to any property for anyone in the community  Makes the Community sports grounds available for anyone in the community so that they can practice whatever sport that will be seen fitted  Offer Bursary awards to children of the employees  Manage the irrigation and drainage across the coastal belt of the country.
B Markets The Corporation continues to provide its products to several markets.

These markets include Local market, Caribbean, Regional, North America and European Market.

These markets have allowed the Corporation to reach its customers as it supplies both bulk and package sugar.

The Corporation is also able to supply Molasses to local and Regional Market.

Molasses is a by product from the Sugar cane production and the sale of it I provides some much needed income for the Corporation.

Table 1.
Table 1.

Revenue by Markets for 2010 Markets Europe North America Caribbean Guyana Other Markets Total Revenues (G$m) 14,600 3,044 3,804 4,606 194 26,248 National Contributions Guyana Sugar Corporation Inc. continues to make a sizeable contribution to the nation.

These are through the forms of Corporation Taxes, Pay As You Earned, Social Security and Pension.

The Sugar Corporation employs approximately 17,000 persons directly.

This level of employment directly affects about 80,000 persons.
Guyana Sugar Corporation In.

continues to the single largest employer of the Cooperative Republic of Guyana.
C Production figures Ten Year Review 2001 to 2010 Operation 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 HECTARES HARVESTED 41,621 41,627 41,959 45,447 41,890 42,422 39,757 44,262 43,556 36,510 TONNES CANE MILLED ('000) YIELDS: ESTATE - TONNES CANE / HECTARE TONNES CANE /TONNE SUGAR TONNE SUGAR / HECTARE PRODUCTION (TONNES) SUGAR 284,474 331,052 302,378 325,317 246,071 259,549 266,482 226,267 233,736 220,818 MOLASSES HOME CONSUMPTION (TONNES): 118,103 137,794 127,201 138,140 115,732 107,501 115,048 99,280 109,598 122,281 SUGAR 24,437 23,782 24,529 23,669 22,781 23,396 23,480 23,345 23,594 22,341 MOLASSES EXPORT (TONNES): SUGAR MOLASSES SALES: DOMESTIC SUGAR ($M) 1,109 1,066 1,286 1,319 1,335 1,644 1,673 1,595 1,906 2,273 AVERAGEPRICE / TONNE($) 45,380 51,556 52,428 55,723 58,601 70,245 71,252 68,328 76,857 101,757 EXPORT SUGAR ($M) 20,287 22,562 25,094 25,288 21,324 25,509 27,101 23,777 24,398 18,332 AVERAGE PRICE / TONNE ($) AVERAGE PRICE / TONNE (US$) 80,569 79,886 80,469 87,498 92,835 107,332 110,676 115,832 112,067 93,652 426 417 418 439 465 538 545 570 552 462
 MOLASSES ($M) 1,330 1,177 1,373 1,265 1,637 1,914 1,667 1,306 1,815 2,932 EMPLOYMENT COST 12,821 14,449 16,207 16,444 14,710 16,067 17,373 17,580 15,571 15,787 MATERIALS AND SERVICES (LOSS) / PROFIT BEFORE TAX ($M) (LOSS) / PROFIT BEFORE TAX AND LEVY (LOSS) / PROFIT AFTER TAX($M) (LOSS) / PROFIT AFTER TAX BEFORE LEVY AVERAGE MID MARKET 7,314 7,496 7,754 7,220 8,408 9,485 8,958 10,858 10,629 11,565 (1,235) (328) (1,130) 1,220 (1,188) 2,429 2,159 (6,210) (1,949) (5,136) (1,235) (328) (4,006) 1,220 (1,188)
 2,429 2,159 (6,210) (1,949) (5,136) (869) (274) (1,429) 261 (1,866) 476 630 (4,089) (1,323) (7,387) (869) (274) (4,305) 261 (1,866) 476 630 (4,089) (1,323) (7,387) EXCHANGE RATE (G$ / US$) 189.38 191.27 192.33 199.28 199.75 199.50 202.99 203.34 202.83 202.99 D Board of Directors Dr. Nanda Gopaul Chairman Mr. Paul Bhim Chief Executive Officer Dr. Raj Singh Member Mr. Keith Burrowes Member Mr. J. Raghurai Member Mrs. Geeta Singh-Knight Member E REPORT OF THE DIRECTORS For the year ended 31st December, 2010 The Directors of the Guyana Sugar Corporation Inc. present their report together with the audited financial statements for the year ended 31st December, 2010.
Principal Activity The principal activity of the Corporation is the growing of sugar cane and the manufacture and sale of sugar and molasses from that cane.

Results and Dividends The financial results of the Corporation are set out on pages 6-38.

In accordance with the policy of the Corporation for many years, no dividends are declared or payable.

Directors The names of the Directors are set out on page E. All the Directors are non-executive, except for the Chief Executive.
None of the Directors during the year had any material interest in any contract which is of significance in relation to the business of the Corporation.

Directors’ remuneration is set out in note 14.2.3 to the Financial Statements.

Corporate Governance The Board believes that its primary function is to generate sustainable wealth for the shareholder as the key stakeholder in the business.

The Guyana Sugar Corporation recognises the importance and is committed to high standards of corporate governance.
This report by the Directors covers the key elements regarding the application by the Corporation of the principles of corporate governance.

(a) The Board: The Board comprises of six non-executive Directors (including the Chairman) and one executive Director (the Chief Executive).

The Board considers that each Director is able to bring independent judgment to the Corporation's affairs in all matters.

The Board meets not less than ten times a year.


It is responsible for the strategic direction of the Corporation and receives information about the progress of the Corporation and its financial position each month.

This information, together with papers required for each Board meeting, is circulated in a timely manner before each meeting.

F The Board has established the Central Tender Committee which evaluates all tenders for the supply of materials and services above predetermined levels.
(b) Internal Control: The Board is responsible for the Corporation’s system of internal control and for reviewing its effectiveness which is designed to provide reasonable (but not absolute) assurance regarding the safeguarding of assets against unauthorised use, the maintenance of proper accounting records and the reliability of the financial information used within the Corporation.
The framework of the Corporation’s system of internal control includes: - an organisational structure with clearly defined lines of responsibility and delegation of authority; - documented policies, procedures, and authorisation limits for all transactions including capital expenditure; - a comprehensive system of financial reporting.

The Board approves the annual budget and actual results are reported against budget each month.

Any significant adverse variance is examined and remedial action taken.
Revised profit forecasts for the year are prepared on a quarterly basis; - an internal audit function The system of internal control is designed to manage rather than eliminate risk as no system of control can provide absolute protection against loss.
The Directors are of the opinion, based on information and explanations given by management and the internal auditors, and on comment by the independent auditors on the results of their audit, that the Corporation’s internal accounting controls are adequate and that the financial records may reasonably be relied upon for preparing the financial statements and for maintaining accountability for assets and liabilities.
Employees Staff development and training are provided at all levels and emphasis is placed on both technical and personal development.

GuySuCo is committed to equality of opportunity amongst its employees.

Recruitment, terms of service and career development are based solely on ability and performance.

G Pensions The Corporation’s senior staff Pension Scheme is established under an irrevocable trust.

The Pension Scheme Management Committee includes employee representatives.
The Scheme is managed by Professionals.

Both the Committee and the Managers are required to act at all times in accordance with the rules of the Scheme and to have regard to the best interests of the members of the Scheme.

The Management Committee controls the investment funds, which are managed by external fund managers.

GuySuCo is committed to ensuring that the Scheme is administered in accordance with the highest standards.
In addition to the senior staff pension scheme the Corporation pays an ex-gratia pension to those unionized workers who satisfy the qualification criteria for a pension.

This scheme is unfunded.

Material events after year-end There was no material event that is material to the financial affairs of the Corporation or the group occurring between the date of the Balance Sheet and the date of approval of the Financial Statements.

Auditors The Auditor General has audited the Financial Statements.
For the financial years 1995 to 1998, inclusive, this activity was sub-contracted to Deloitte and Touche; for the financial years 1999 to 2003 this activity was sub-contracted to Ram and McRae; for the financial years 2004 to 2010 this activity was subcontracted to TSD Lal & Co. By order of the Board Frederick Singh Company Secretary Registered Office Ogle Estate East Coast Demerara H