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Transcript of Annual Kersten 2011
DE TIJDENVERANDERENmoderniseren nu binnen handbereikCKC SURMAC BIEDT DE MOGELIJKHEID VOOR FINANCIERING
building a sustainable future annual report 2010
building a sustainable future
building a sustainable future annual report 2010
Message from the CEO 5
Report of the Supervisory Board 6
Kersten 010 in perspective 8
Kersten’s Green Economy 10
010: A year in review 1
Condensed Consolidated Financial Statements
Independent Auditor’s Report
Business Performance 010 4
About C. Kersten en Co. N.V. 4
CONTENTS
4
building a sustainable future annual report 2010
financial security and social responsibility
5
MESSAGE FROM THE CEOAs we reflect on 010, it becomes clear that the challenges we have faced in the past have
served us well to prepare us for a challenging future. As the Surinamese community reels
from the changes brought about by the new government, and as the economy searches for
a new equilibrium, Kersten serves as a beacon of stability for her employees and her clients.
Kersten has responded to the new realities facing Suriname with renewed diligence and
even more rigorous control measures in terms of cost control and heightened investment
scrutiny and preparing by our organization to offer the market more sustainable financing
solutions. The lack thereof is one of the major bottlenecks for the development of certain
industries in Suriname. While continuing to strengthen her financial position, Kersten
has already started to lead the nationwide transformation towards a more service based
economy, while at the same time deepening our involvement in existing industries, such as
mining, forestry, infrastructure and agriculture.
When looking ahead, we are imbued with strengthened resolve to ensure that new ventures
lead to revenue, industry, customer and risk diversification. We are confident that our new
ventures will blossom, in part to our commitment to excellence, but also through new and
strong bonds with strategic partners, financiers, world class suppliers and customers.
Although profitability, financial security and social responsibility remain firmly fixed in our
business culture, we are intensifying our focus on risk management, compliance and opera-
tional excellence.
An uncertain future awaits us, but one thing is clear above all, and that is that our almost
4 year tradition of perseverance and business flexibility, socially responsible entrepre-
neurship and innovative solutions will continue to guide our actions.
We thank our employees for their loyalty and commitment and our suppliers and customers
for their unceasing trust.
Shirley Sowma-Sumter
Chief Executive Officer
financial security and social responsibility
6
…commitment and devotion In compliance with the provisions of articles 9 and 12 of the Articles of Association we have the honour of submitting the annual report and accounts for the financial year 2010, as approved by us. The annual accounts have been audited by KPMG Accountants B.V. and their report is included herein. Pursuant to article 12 clause 12.6 of the Articles of Association, we recommend that you adopt the present annual accounts, and discharge the Board of Management of their responsibility in respect of the management carried out during the reporting period and that you discharge the Supervisory Board of its responsibility in respect of their supervision. We agree with the proposal of the Board of Management to add the Net Profit to the general reserves.
building a sustainable future annual report 2010
Considering the economic environment, Kersten showed a good performance in 010. It
proved the resilience of our activities.
As said last year we would continue to develop our company. In that regard major steps
were set to better service our customers and to benefit from commercial opportunities.
In the beginning of the year a joint venture was established with Cementos Argos S.A.
to strengthen our cement operations. Later in the year a letter of intent was signed with
Neal & Massy Holdings Limited to jointly expand the service to our customers. Kersten
and its customers can benefit from the knowledge and expertise of our partners.
CKC Motors successfully introduced two new car brands, JAC and Mahindra, to widen our
product offerings to our clientele.
Surmac and DAF Nederland signed a dealership agreement and introduced Caterpillar
Certified Used Equipment and Alginco successfully expanded its Mitsubishi dealership.
Other initiatives taken were the establishment of the first Carbon Laboratory in Suriname
together with Conservation International, which will enable the valuation of the tropical
forest and the Kersten Tourism Foundation continued the development of the interior
community in the Brokopondo District. The first stone was laid for the Brokopondo
Vocational Training Center.
The launching of SurmacRent in January 011 is an example that we will continue
to develop our operations to further strengthen our position as one of the leading
companies in Suriname.
Last but certainly not least, we would like to express our gratitude to all our employees
for their continued commitment and devotion without which, we would not have been
able to realize what has been achieved. We thank them for their valuable contribution
and unrelenting efforts. We also would like to thank our customers and suppliers for
their continued confidence in us. And finally we would like to compliment management
with the results achieved.
On behalf of the Supervisory BoardDavid A. Voûte
Chairman
SUPERVISORY BOARD
REPORT OF THE
8
Kersten 2010 in perspective
WORKING IN
During the year under review, businesses were generally able to operate under a more favorable macroeconomic climate. This mainly resulted from improved cyclical external conditions. After being affected by the global recession in 2009, the economy of Suriname clearly benefitted from a recovery particularly in the systemic emerging markets. Prices of virtually all our export products surged. The current account of the balance-of-payments closed with a historical large surplus. Consequently, growth in gross domestic product accelerated from an estimated 3 percent in 2009 to 4.5 percent in 2010. Investment activities were quite satisfactory.
Consumption remained buoyant. Government spending
continued to grow due to the start of the implementation
of the second phase of the civil service wage reform and to
more purchases of goods and services. The latter were partly
financed by an increase in payment arrears. On its turn, this
contributed to the rise in commercial bank loans to enter-
prises and eventually to a further increase in the already
ample macroeconomic liquidity ratio. As a result, the annual
average increase in the consumer price index surged from a
mere 1. percent in 009 to 10. percent in 010. The notable
acceleration in the inflation rate was also brought about by
physical and institutional capacity constraints, higher prices
for imported and local commodities and depreciating foreign
exchange quotations on the parallel market,
Sales figures of the various sectors of the economy were
on average favorable. The gold sector expanded somewhat
further and contributed for a notable 60 percent to our
national export earnings, thanks to a 6 percent increase in
world market prices. IAMGOLD was able to push up its produc-
tion volume with another 4 percent to a record 406,000 troy
ounces, following an impressive 4 percent rise in 009. Total
tax revenue transferred by this company to the government
(including wage tax and general pension premiums) went
up by 9 percent to USD 18 million. Despite a 6 percent
higher average proceed per barrel, production volume of the
crude oil sector remained virtually constant. However, net
profits of STAATSOLIE Suriname N.V. increased by 59 percent.
Its transfers to treasury rose to USD 156 million, making
the company the largest single contributor. Production of
alumina, until recently the cornerstone of our economy,
shrank by percent due to a lagging supply of bauxite.
building a sustainable future annual report 2010
9
A CHALLENGING BUSINESS ENVIRONMENT
The production capacity of the refinery was utilized for only
65 percent. Even so, Suralco’s export value rose by 6 percent,
but its tax payments shrank by some 55 percent to a mere USD
1 million.
Enterprises in agricultural, forestry and fishing sectors could
only modestly take advantage of higher prices for commodi-
ties and foodstuffs. Attempts to enhance production capacity
were hindered by structural weaknesses and insufficient
comparative advantages. Padi production remained roughly
constant, while the export price of cargo rice went up by
almost 10 percent. The hospitality and tourism industry
witnessed a welcome reversal in the decline in the number
of visitor arrivals recorded during 009. The risk of being
confronted with excess capacity remained as the expansion of
hotel and lodging facilities continued. The construction and
trade businesses continued to benefit from high consumption
and investment spending.
Business climate is expected to remain favorable for the
time being. The current revival in the world economy will
continue to stimulate production, particularly in the export
industries. Of course, this will stimulate supply and other
companies, including our own enterprise. Calculations of
the International Monetary Fund suggest, that growth in
domestic production will pick up further during 011 to some
5 percent. Medium term growth prospects are solid, given the
buoyant commodity prices, the intended large investments
in mineral and energy sectors, as well as the execution of a
government’s program to improve and expand the existing
infrastructure. Against this background, Standard & Poor’s
affirmed its long-term foreign and local currency debt ratings
at “B” and “B+”respectively. The foreign-currency outlook
was kept unchanged, but may be upgraded particularly if the
growth prospects materialize, and additional steps are taken
to strengthen public institutions and to improve the ease of
doing business. However, the outlook for the local-currency
rating was revised to stable from positive, reflecting the
sovereign’s shallow local capital market and the ensuing
limited effective availability of the monetary policy tools.
It is clear that working in such a promising and challeng-
ing environment creates additional opportunities for
the business sectors. To be able to exploit these oppor-
tunities, more innovative private initiatives should be
initiated in the non-mineral sectors. This is the prefer-
able way to expand and diversify the economic structure
and to create employment. Equally important is that the
current acceleration in the inflation rate is reversed. Apart
from the factors already mentioned above, this unsatisfac-
tory development is partly caused by the recent income
generating measures, particularly with respect to the fuel
tax taken by the government to alleviate current liquidity
constraints. The 0 percent devaluation of the exchange
rate vis-à-vis the US dollar, which was taken in January
011 to bridge the gap with the quotations on the parallel
market, also affected the prices of goods and services to
some extent. At the end of May 011, the consumer price
index was more than 0 percent higher than a year earlier,
constituting a matter of serious concern. Thus, sound
macroeconomic policies must by pursued to reduce the
rate of price increases and to contain inflation expecta-
tions, in order to create a climate conducive to a sustain-
able business expansion. On the budgetary and monetary
front, more attention should be paid to containing
consumptive spending by both the public and the private
sectors, also by conducting cautious wage policies. At the
same time, structural weaknesses should be addressed,
to improve our international competitive position. The
extent of success of such policy actions will decisively
determine the pace of the further development of our
economy.
10
KERSTEN’S GREEN ECONOMY
As the world turns her focus to “going green”, captured in the heightened recurrence of catch phrases such as, Green Energy, Green Economy and Green Development, Kersten is already one step ahead. As presented in her annual report 2009, Kersten has been “going green” for over 240 years. Kersten was founded with the principle value of developing the Surinamese community, and continues to focus on this core value by investing in capacity building, education and healthcare, through her operational activities and through her dividends.
ForestThe
Exp.
ADVENTURE
EXPERIENCE
CENTRE
MEASURING THE FOREST CARBON
DISCOVER THE SPECTACULAIR JUNGLE OF SURINAME
made possible by
CONSERVATION INTERNATIONAL
building a sustainable future annual report 2010
11
At the heart of the “Green Economy” movement, lays
a heightened focus on sustainable development and
sustainable entrepreneurship, two concepts that have
been part of Kersten’s culture since her inception.
“For the purposes of the Green Economy Initiative, UNEP has developed a working definition of a green economy as one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.”
Although these concepts have always been a part of
Kersten’s culture, recent years have seen Kersten increase
her focus on green economics, a focus which has resulted
in the following “Green Economy Initiatives”
Sustainable and renewable energyThrough her partnership with IAMGOLD, Kersten has
successfully conducted an alternative energy research
project in the Brokopondo region. Although the outcomes
of the study have yet to lead to realized alternative energy
deployment, the process of identifying feasible alterna-
tives has been completed in 010 and the coming years
will provide ample opportunity to implement and start
benefiting from the options identified.
Poverty reduction through knowledge transfer and opportunity creationWith the building of the Bergendal Eco cultural River
Resort, Kersten has created substantial economic activity
in a region which was previously best described as forlorn
and dangerous. After having served as the birthplace of
Suriname in ages past, the Bergendal region had been
abandoned, and all economic activity, save rogue mining
had ceased. It is Kersten, with her vision and dedication
to Eco-Tourism and sustainable development that has
brought back employment, purchasing power and signifi-
cant educational opportunities to this region. Now in her
third year, Bergendal is continuing to serve as a highly
coveted regional employer and is constantly investing in
increasing local opportunities.
Support of scientific research and investment in Climate Change AwarenessCarbonlab, Carbontour, Living Lab, the project that is
currently in her final stages has had many names,but the
focus has stayed true. Kersten, Conservation Interna-
tional, CELOS, The ministry of Forestry and IAMGOLD have
joined forces to create a truly unique tourism product.
For the first time, anywhere in the world, tourists and
forestry students will share the same eco-space, as one of
the first official carbon measurement plots that will play
a key role in Suriname’s Climate Change Finance agenda
will be transformed into a “Living Forest Experience”.
The “Forest experience” emphasizes Suriname’s
enormous biodiversity and allows tourists and students
both to learn and experiment with the concept of Forest
Carbon measurement and registration.
Capacity strengthening of rural area inhabitantsThe founding of the Vocational School in Brokopondo,
led by the Kersten Tourism Foundation, and backed by
grants, donations and non-financial support from: the
IADB Group, the government of Suriname, the Moravian
Church Foundation, Kersten, Twinning Facility Holland-
Suriname, ZZg (Education for Work program), Van Den
Top Machinebouw, Rijn Ijsel College, Wolters Noordhof,
Kenteq, IAMGOLD, UTSN, Haukes N.V. and many other
private persons and companies, is the first of its kind in
the region and will enable the rural population to obtain
the necessary skills in hospitality, mining and other
related industries that will allow them to raise their living
standards as well as stimulate local entrepreneurship and
development.
Kersten has, and always will put the community first,
and her legacy of sustainable entrepreneurship and long
term development will continue to serve as an example
in Suriname as one of the leaders in the new, Green
Economy.
1
2010 A YEAR IN REVIEWHEALTHCARE:
building a sustainable future annual report 2010
1
In the last quarter of 010, the final decision was taken to
transfer the Kersten pool to Staats ZiekenFonds (the State Health
Insurance Fund). Although the annual reports showed that over
the past two years Medicare was cost effective and efficient,
the provision ‘medical costs’ gave the management cause for
concern. Given the unpredictability of medical expenses, these
services threaten to impose an increasing pressure on the
operating profit, making it wise to move the risk.
Within the Kersten Group Medicare increasingly gained a
foothold as an organization advising, supporting, but also
implementing all matters related to the health of the Kersten
employees. Thus, the “Alcohol, Drugs and Drug Policy”
and Absenteeism Policy are monitored and specific activi-
ties are implemented together with the HRs of the Holding
and other companies. There is therefore in terms of absen-
teeism a decline of 6% in the number of sick days in 010
compared to 009.
In 011, Medicare will further focus on establishing
collaborations in various fields, including with Sint Vincen-
tius Hospital and other health-care partners; endoscopy and
pharmacy are being considered.
In 010 Incom formally became an agent of Novartis
Pharma, one of the largest pharmaceutical manufacturers
in the world. Novartis Pharma is a leader in oncology and
dialysis, and will contribute to the volume of business.
By adjusting our portfolio of consumables, we have been
able to properly respond to the new services offered in
Suriname such as the opportunity to renew the beds of the
Intensive Care Unit of the Academic Hospital. These new
beds meet international intensive care unit requirements,
where the critical care services (minutes and seconds) are
particularly important in case of an emergency. Because of
the peripheral equipment and related instruments these
beds are very effective for treating trauma patients.
For 011 we have the following intentions:
Professional careTop patient care treatment is becoming more common-
place in Suriname as a result of the fact that specialists
trained abroad return to Suriname with new knowledge
and techniques. Incom will and can further develop its
market share in dialysis and oncology, because of the
agreement concluded with Novartis Pharma.
Hospital portfolio Manufacturer Tempur Pedic International, the second
largest supplier of mattresses in the world, approached
Incom to be its dealer in the region.
For this agency we see a market in Suriname and Guyana.
In 011 we will enter into a partnership with CBZ Ltd.
This company specializes in Rapid Diagnostic Tests.
Using a rapid test, a condition may be diagnosed immedi-
ately when visiting a doctor. This rapid establishment
of a clinical picture is for both the doctor and patient
important. These rapid diagnostic tests prevent delays.
Alcolado GlacialAt the request of patentee Curaçao Laboratories, Suriname
Laboratories developed a hands sanitizer, which was
enthusiastically received by both the patentee and others
who were asked to assess the product. The intention is to
launch this product in the second half of 011.
Healthcare: CKC International Commodities (Incom) N.V.
Healthcare: CKC Medicare N.V.
Healthcare: Surinam Laboratories (Surlab) N.V.
14
2010 A YEAR IN REVIEW
building a sustainable future annual report 2010
15
In 010 considerable emphasis was put on improving the
operations of the various departments of the BergenDal
organization and on implementing routines for ongoing
maintenance. Great leaps forward were made for both.
BergenDal grew in two years into a mature organization.
The positioning of BergenDal received an enormous
boost in 010, particularly because several Dutch
newspapers and magazines published positive reviews
of the resort, and also as a result of the shooting of the
Dutch soap series “Goede Tijden, Slechte Tijden” (Good
Times, Bad Times), which aired on Dutch television in
Kersten Tourism Foundation (KTF)The construction of the Brokopondo Vocational training
Center (BVTC) will be completed in 011 and preparations
for a soft opening in July 011 are in full swing. BVTC is
poised to start operations in the third quarter of 011.
Along with training the first local teachers in hospitality,
a great deal of work has been done to create the required
management structure to ensure effective operations.
The district commissioner of Brokopondo will sit as head
of the board of the center, contributing to local accept-
ance and embedding a high degree of authority within
the ranks of the school. Although a great deal has been
achieved in 010, KTF is looking forward to 011 to raise
her profile and her level of contribution in the district of
Brokopondo and continues her commitment to poverty
alleviation and job opportunity creation in the region.
hospitality
In 010, Krasnapolsky prepared renovations, namely the
renovation of the fourth, fifth and sixth floors (rooms) and
the renovation / relocation of Popeyes 1. The renovation
of the floors will commence in May 011 and will last until
August 011.
The renovation of the floors is performed by Decorum.
Decorum took care of the interior design of Bergendal
Eco-Cultural River Resort in 008. The relocation of
Popeyes 1 from the first floor to the ground floor will
be completed in February 011. Krasnapolsky will also
renovate its central cooling system in 011. The renova-
tion projects of Krasnapolsky are budgeted at approxi-
mately USD 1,00,000.
December 010. In August 011 Bergendal will act as host
of Bergendal Flavors, an annual event. During this event
chefs from various countries will teach and follow classes
at BergenDal with an emphasis on the use of herbs from
the District of Brokopondo. Bergendal has become the
most professional and luxurious resort in the Guianas.
In a review published on Tripadvisor is stated with good
reason: “You’ll find nothing approaching the luxury
and svelte of Bergendal or anywhere else in the three
Guianas”.
Kersten Hospitality: CKC Hotelmaat schappij N.V. (Krasnapolsky)
Kersten Hospitality: BergenDal, Eco & Cultural River Resort N.V.
16
building a future annual report 2010
2010 A YEAR IN REVIEW
Argos produces cement for Panama Canal expansion in Pananma
building a sustainable future annual report 2010
1
In February 010 an agreement was signed between
C. Kersten en Co. N.V. and Cementos Argos S.A. This was a
turning point in the development of Vensur and Kersten.
As a well known multinational, Cementos Argos brings
in a lot of industry knowledge, expertise, know-how
and all the resources of a large multinational, while
Kersten brings to the table excellent knowledge of the
Surinamese market. Cementos Argos S.A. is the leader
of the Colombian cement industry with a market share
of 51%. It is the fourth largest cement producer in Latin
America with investments in Panama, Haiti, the Dominican
Republic, St. Thomas, St. Martin, Antigua and Dominica.
sharing the knowledgeJoint Ventures
Building & Construction: BEM
An analysis was made in 010 of the structural integrity
of the buildings / warehouses. The outcome was that the
warehouses of the pipe factory, the warehouse at Spanbeton
and the Conder warehouse had to be renovated. Besides
the necessary renovations, it was important to invest in
our staff. Therefore, all heavy equipment operators were
trained and certified. The weekly “safety talk” is still taking
place and the ‘housekeeping’ inspections take place every
month with different teams. The outcome of the inspections
are presented by the employees themselves, which results in
greater involvement of everyone. Through this joint effort, the
number of serious incidents in 010 remained limited to only 1.
As a result of the elections and the amount of projects granted
by the Ministry of Public Works, BEM went of to a flying start
in 010. The results were positive until the elections and even
above budget.
In the first half of the year the construction of the plant of a
competitor was completed. This factory went into production
from July 010 resulting in an oversupply in the market and
associated price war. For building blocks (solid 4” and solid
6”) in particular, which account for a large proportion of our
sales, the prices and gross margin plummeted. Average price
decreases amounted to on average 5%. To maintain our
It is the sixth largest producer of fluid concrete in the United
States and exports cement and clinker to countries.
The Joint venture allows Vensur to increase its production
capacity in the first year of the joint venture from 50,000
tonnes of cement per year to around 100,000 tonnes of
cement per year. By mid 011 Vensur will have a market
share of 50%, more than double its market share in 010.
In 011 the joint venture partners will develop strategies to
further increase the production capacity with export as a
serious option. With the joint venture Vensur has consoli-
dated its position as cement producer in CARICOM and
created opportunities to strengthen its position.
Building & Construction | Kersten and Cementos Argos S.A.: Vensur
18
building a sustainable future
market position, BEM had no choice but to follow this negative
price trend. After all, BEM and other producers were otherwise
running the risk of this competitor taking over the market.
In the second half of the year the government started to
default on its payments. This meant that most of the projects
in progress came to a standstill as of August, and orders
failed to materialize.
The combination of the above two developments had a
negative impact in the second half of the year.
In the meantime through our partnership with the Neal &
Massy Group in general and with PresTcon in particular,
we have identified new opportunities for both BEM and
Spanbeton. The activities of Spanbeton have been put on
hold.
Against the background of strong competition in the
market, we have to increase our sales and marketing activi-
ties. The intention is to participate again this year in the
Chamber of Commerce’s Fair and we will participate for the
first time in the “Woonbeurs” (Home and Living Fair).
Following the successful implementation of the reorgani-
zation program in 009 with a continuation in 010,
we confront the challenge of fierce competition with
confidence.
Algemene Installatie Maatschappij N.V., better known by
all as Alginco is part of the Kersten Building & Construc-
tion Division. Alginco is an installation company, special-
ising in indoor air quality control, electrical installations
and a range of other installation products from water
distribution to data networks.
In the year 010 Alginco set out to meet the challenge of
installing new generation products. Strengthened by a
year of intensive training and building of partnerships,
the time had come to implement the new approach in the
market. The first quarter was still a bit slow, but successful
and on time completion of several projects gained Alginco
a lot of momentum and resulted in a very busy second half
of the year. A strong base was developed to further propel
the company forward into success for the years to come.
In 011 Alginco’s main goal is to efficiently increase
capacity. This will be achieved by a combination of
measures, including HR developments, increasing and
transformation of stock and other improvements of the
internal organization. By working hard to offer continuity
and prosperity for the stakeholders Alginco strives to keep
filling in the true essence of its motto; “Alginco installs the
future”.
Building & Construction: Alginco
19
SNT Kersten N.V. is a joint venture between the largest
customer contact organization in the Netherlands, SNT
B.V. and C. Kersten en Co. N.V. The joint venture was in
fact started in August 010. By law, the joint venture will
be put into effect in the fourth quarter of 011.
The first customer of SNT Kersten is the Dutch mail order
company OTTO B.V. In 011, the portfolio of SNT Kersten
will be expanded. It is expected that at the end of 011
approximately 150 persons will find employment in this
joint venture. The organizational chart of Kersten shows
SNT Kersten as part of the Communication Services
Division.
building a sustainable future
Real Estate and Properties: CKC Warenhuis N.V. Since late 005 the Warenhuis building is leased to a third party while new plans for improving the commercial viability
of the real estate are being worked out.
NFD holds a 40 year lease on 5.4 hectares of the Belle
A Soir property, to be developed for affordable housing
with the IADB and De Surinaamsche Bank N.V. as partners.
The project, which is adjacent to the Richelieu project of
the Government of Suriname, was put on hold following
an assessment regarding the drainage situation of the
area. This requires substantial investments by the govern-
ment to guarantee a proper drainage of the total area.
Real Estate and Properties: Neptune Financiële Dienstverlening N.V. (NFD)
Kersten Warenhuis in the sixties of the last century.
Kersten Communication Services: SNT Kersten N.V.
0
Motors and Heavy EquipmentMotorsThe effects of the overall global economic crisis could still
be felt in 010. Importers of used vehicles have continued
the trend of importing more vehicles, so that the spurious
competition with official importers of more vehicles still
occurs, mainly for passenger cars (gray market).
In 010 there also was a dominance of so-called “import
duty-exempted” sales which resulted in less sales
compared to 009 although the number of units sold was
higher.
2011 prospectsWe have a positive outlook on the year 011.
The Mahindra Scorpio has made a good entry, despite
the unpopular design. The pick-up is found to be a good
workhorse and is sturdy, robust and comfortable.
Considering the price, the JAC is a very good alternative to
the second-hand pickup truck with a capacity over 1 ton.
Expectations are that JAC may experience some compe-
tition from the JMC-Isuzu pickup truck introduced by
Yokohama, which is also made in China. The tax-increasing
measures by the government will be clearly detrimental,
especially for the sale of large cars.
If the planned production increase of IAMGOLD comes
through, a sales increase of Toyota is expected.
In addition, the signing of the agreement with Newmont
will be positive for Toyota.
There is an opportunity for the Mahindra Scorpio to be
deployed at Suralco, replacing the Toyota Hilux vehicles
whose lease period expires.
The construction of the new showroom is well advanced
and will be ready for use in May 011. This will be the
Chevrolet sale room.
SurmacIt was expected that 010 would be a difficult year because
of the elections and that customers would not commit to
major investments.
As a result the machine sales were expected to remain far
behind those previous years.
The focus for 010 was for that reason on diversifying
our portfolio in terms of products, markets, regions and
customers and in particular on the penetration of the
small-scale mining market.
Besides providing funding for this group, the possibility of
1
Used Equipment was also offered while we made prepa-
rations to ad Rental solutions to our product offerings.
We have achieved our goals, to our satisfaction.
An important part of the machine sales were for used
machines and generators.
The slight increase of the parts sales compared to 009
was the result of the expansion of the outlets and of
acquiring the dealership of AK purifiers.
A new performance management system was imple-
mented in 010, as well as the marketing & sales depart-
ment. The Technician Career Development Program was
introduced to strengthen the service department, as well
as the technician apprentice program as part of our long
term service manpower planning.
Expected market developmentsWe expect, considering the continuous increase of
the international gold price, that the gold sector will
continue to grow.
The signs are on the wall that the oil and the forestry
sectors will also continue to grow, while growth perspec-
tives in the bauxite and construction sector are still
uncertain.
In 011 we will celebrate 0 years of dealership of Cater-
pillar, provide more financing solutions for the market,
acquire the DAF dealership and renovate and rebrand our
Nickerie offices.
building a sustainable future
CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
RevenueCost of saleGross profit
Other incomeTotal income
Employee benefit expensesDepreciation
Other operational expensesTotal expenses
INCOME FROM OPERATIONS
Financial incomeFinancial expenses
Net financial expenses
Share of profit of associates
Income before taxationIncome taxes
Profit from continuing operations
Discontinued operations
Profit (loss) from discontinued operations(net of income tax)Profit for the year
Profit attributable toEquity holders of the Company
Total comprehensive income attributable toEquity holders of the company
Non- controlling interestsTotal comprehensive income for the year
010
64.814.5464.54.08.460.508
810.1923.270.637
8.19.8644.401.951
10..6522.859.490
411.147
.0.41-.58.6
45.059
.088
693.294-615.09
1.309.003
5.665
1.561.668
1.561.6681.561.668
1.561.668
1.561.668
009
89.583.22161.85.00.0.14
46.9528.477.139
8.58.444.8.444
10..69823.159.585
5.317.554
58.089-.489.04-1.960.985
80.58
3.737.156-14.910
3.881.066
-41.140
3.839.926
3.839.926.89.96
.89.96
3.839.926
CONDENSED CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME (IN USD)
4
ASSETS
Property, plant and equipmentIntangible assets
ReceivablesInvestment property
Deferred tax assetsOther financial assets
Total non-current assets
InventoriesTrade and other receivables
Income tax receivableOther current assets
Cash and cash equivalentsAssets classified as held for sale
Total current assets
Total assets
EQUITY AND LIABILITIES
EquityShare capital
Share premium reserveRetained earnings
Equity attributable to equity holdersNon-controlling interest
Total equity
LiabilitiesLoans and borrowingsDeferred tax liabilities
Employee benefitsOther liabilities
Total non-current liabilities
Loans and borrowingsTrade and other payables
Short term provisionsIncome tax liabilities
Other current liabilitiesLiabilities directly associated with assets classified as held for sale
Total current liabilities
Total liabilitiesTOTAL EQUITY AND LIABILITIES
12-31-10
45.10.989.16
1.019.81510.50
1.6.151.446.440
51.609.9
10.681.09710.16.5
11.004.594.058.98.616.59.9
40.131.316
91.740.545
18.1840.050
6.8.199.515.41
18.637.702.807
11.5.1510.5.44.10.00
15.00026.345.758
9.49.481.01.99
606.101.4
4.960.551 -
27.691.980
54.037.73891.740.545
12-31-09
49.06.69045.645
.004.48.85.641.191.886.441.840
58.50.80
9.079.09611.08.4
11.15.66.51.81.145.06.0
36.493.737
94.997.540
18.1840.050
8.15.518.95.6
98.939.882.696
18.450.08510.1.0.44.84
100.00033.026.657
6.105.89.116.941
491.641.455.0814.58.40.160.889
22.088.187
55.114.84494.997.540
CONDENSED CONSOLIDATED
STATEMENT OF FINANCIAL POSITION
(IN USD)
5
Income from operations (including discontinued operations)Adjustments for:
- Depreciation- Change in provisions
- Foreign exchange differencesChanges in working capital
- Inventories- Trade and other receivables
- Other current assets- Current loans and borrowings
- Trade and other payables- Other current liabilities
Cash generated from operationsInterest received
Interest paidIncome tax paid
Cash flows from operating activities
Net investments in property, plant and equipmentProceeds from sale of property, plant and equipment
In/decrease Investment PropertyNet investments in intangible assetsIn/decrease non-current receivables
Proceeds from disposals of investmentsIn/decrease non-current financial assets
Receipt of government grantCash flows used in investing activities
Release deferred tax in equityDisposal of partial interest in Vensur N.V.
In/decrease non-current loans and borrowingsIn/ decrease non-current liabilities
Dividends non-controlling interestsCash flows from financing activities
Net in/decrease of cash and cash equivalentsCash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents at end of year classified as assets held for sale
Cash and cash equivalents at end of year
010
66.81
4.6.1404.1888.006
-1.49.51.565.48-.841
.14.9595.40.59
-9.9514.590.91
9.00-.58.6-.4.81
10.399.754
-5.006.805..1
61.09-9.0
984.661.0.41
54.4081.6
1.374.422
-504.40-.4.69
5.000-.999.965
-10.694.204
1.079.9727.903.3898.983.361
-
8.983.361
009
5.6.41
4.1.956.86.8
.4.1-.89.501.145.665
481.99994.90
-1.440.0451.9.45
90.10-.489.04-.01.6848.261.787
-.80.4.94
- -96.981
-1.96.6051.5919.0
.05-3.983.802
- -4.51.00
- -0.4
-4.532.453
-254.4688.157.8577.903.389
.15
7.831.214
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (IN USD)
6
Corporate informationThe principal activities of C. Kersten en Co. N.V. and its
subsidiaries (together “the Group”) are:
• the trade in motor vehicles and heavy equipment
including parts;
• the production of and trade in medicines and other
healthcare products;
• the production of and trade in cement and concrete
products;
• the trade in air-conditioning, machine building, electronic
parts and systems;
• the leasing of land and buildings and
• hospitality and franchises.
Interest in joint venture Alexios N.V.On November 1, 008 a share purchase agreement between
the Company and Cementos Argos S.A., a corporation estab-
lished in Colombia has been signed. This agreement has
been settled on February 16, 010. The Company sold on that
date its ownership of 84.4% in Vensur N.V. to Alexios N.V.,
domiciled in Suriname. At the same date the Company sold
50% of the shares in Alexios N.V. to Corporaciones e Inver-
siones del Mar Caribe S.A.S, subsidiary company of Cementos
Argos S.A., domiciled in Medellín, Colombia.
The principal activity of Alexios N.V. is administering the
shares of Vensur N.V.
Due to the sale of the shares of Vensur N.V. in 010, the assets,
liabilities and results are proportionately consolidated in the
financial statements of the Group compared to full consolida-
tion in previous years.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Notes to the
Basis of preparationStatement of complianceThe consolidated financial statements for the year 010 have
been prepared in accordance with International Financial
Reporting Standards (IFRS) as issued by the International
Accounting Standards Board (IASB).
Basis of measurementThe consolidated financial statements have been prepared on
a historical cost basis, unless otherwise indicated.
Functional and presentation currencyThe Group’s functional currency is Suriname dollars (SRD),
with the exception of CKC Machinehandel Surmac N.V.
and Surmac International N.V. The SRD is the currency of
the primary economic environment in which the Company
operates. Each entity in the Group determines its own
functional currency.
From the year 010 the consolidated financial statements are
presented in United States dollars (USD) instead of SRD. This
change in presentation currency has been made to gain a
better insight in Kersten’s economic performance to the users
of the financial statements, which are mostly internationally
oriented. All values are rounded to the nearest USD except
when otherwise indicated.
Use of estimates and judgmentsThe preparation of financial statements require management
to make judgments, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets and liabilities, income and expenses. Actual results may
differ from these estimates.
Good Times… in BergenDal
Estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recog-
nized in the period in which the estimate is revised and in
future periods affected.
Basis of consolidationThe consolidated financial statements comprise the financial
statements of C. Kersten en Co. N.V., its subsidiaries and its joint
ventures as at December 1 of each year.
Subsidiaries are fully consolidated, joint ventures are proportion-
ately consolidated from the date of acquisition, being the date
on which the Company obtains control, until the date of disposal
when such control ceases.
The financial statements of the subsidiaries and joint ventures
are prepared for the same reporting year as the parent company,
using consistent accounting policies. All inter-company balances
and transactions, including unrealized profits arising from intra-
group transactions, have been eliminated upon consolidation.
Changes in accounting policy and disclosuresFrom 1 January 010 the Company has applied the following
changes in accounting policy and disclosures:
• IFRS Business Combinations (008)
• IAS 4 Related Party Disclosure (009)
• IAS Consolidated and Separate Financial Statements
(008)
• Improvements to IFRSs 009
New standards not yet adoptedOther than those adopted early as explained above, a number
of few standards and interpretations are not effective for the
year ended December 1, 010, and have not been applied in
preparing these consolidated financial statements. None of
these will have an effect on the consolidated financial state-
ments of the Group.
Summary of significant accounting policies
Foreign currency transactionsTransactions in foreign currencies are translated to the
respective functional currencies of the Group’s entities at the
exchange rates on the date of the transaction.
Monetary assets and liabilities denominated in foreign curren-
cies at the reporting date are translated to the functional
currency at the exchange rate at that date.
Foreign currency differences are recognized in the consoli-
dated statement of comprehensive income.
Non-monetary assets and liabilities denominated in foreign
currencies that are measured in terms of historical cost in
a foreign currency remain translated into the functional
currency using the exchange rates as at the dates of the initial
transactions.
Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date
the fair value was determined.
Non-derivative financial instrumentsThe Group only uses non-derivative financial instruments.
Non-derivative financial instruments comprise investments
in equity, securities, trade and other receivables, cash and
cash equivalents, loans and borrowings, and trade and other
payables.
Property, plant and equipment
Owned assetsUntil the adoption of IFRS, property, plant and equipment are
accounted at revaluated amounts. This value is considered as
property’s deemed cost as per the date of first-time adoption
of IFRS. Property is stated at cost less government grants and
depreciation.
8
Leased assetsAll leased assets are operational leases and are not recog-
nized on the Group’s statement of financial position.
Intangible fixed assetsIntangible assets with finite lives are amortized over
the useful economic life and assessed for impairment
whenever there is an indication that the intangible asset
may be impaired.
The amortization period and the amortization method for
an intangible asset with a finite useful life are reviewed at
least at each financial year end.
Investment propertyInvestment properties are measured initially at cost, including
transaction costs. The carrying amount includes the cost
of replacing part of an existing investment property at the
time that cost is incurred if the recognition criteria are met;
and excludes the costs of day to day servicing of an invest-
ment property. Subsequent to initial recognition, investment
properties are stated at cost less depreciation.
Other financial non-current assetsOther financial non-current assets are recorded at their
historical cost, being the values at which they were
acquired or lower realizable value.
InventoriesInventories are valued at the lower of average cost and
net realizable value.
Trade and other receivablesTrade receivables, which generally have 0 day terms, are
recognized and carried at original invoice amount less an
allowance for any uncollectible amounts.
the wayahead
9
Cash and cash equivalentsCash and cash equivalents in the consolidated statement
of financial position comprise cash at bank and in hand
and short-term deposits with an original maturity of less
than months.
Interest-bearing loans and borrowingsInterest-bearing loans and borrowings are measured
at amortized cost using the effective interest method.
Amortized cost is calculated by taking into account any
issue costs, and any discount or premium on settlement.
ProvisionsProvisions are recognized when the Group has an
actual obligation (legal or constructive) as a result of a
past event. It is probable that an outflow of resources
embodying economic benefits will be required to settle
the obligation and a reliable estimate can be made of the
amount of the obligation.
Pensions and other post-employment benefitsThe cost of providing benefits under the plans is deter-
mined using the projected unit credit actuarial valuation
method, with actuarial valuations carried out at each
year-end.
RevenueRevenue is recognized to the extent that it is probable that
the economic benefits will flow to the Group and the revenue
can be reliably measured.Net sales represent the invoiced
value of manufactured products and services delivered to
customers net of allowances and sales tax. Revenue is recog-
nized when the significant risks and rewards of ownership
of the goods have passed to the buyer and can be reliably
measured. Cost of sales is recorded in the same period as
sales are recognized.
Other revenues are recorded in the period in which they
originate.
ExpensesExpenses are determined based on the aforementioned account-
ing principles and allocated to the year to which they relate.
Income taxIncome tax expense comprises current and deferred tax.
Current tax and deferred tax are recognized in profit
or loss except to the extent that it relates to a business
combination, or items recognized directly in equity or in
other comprehensive income.
Current tax assets and liabilities for the current and
prior years are measured at the amount expected to be
recovered from or paid to the tax authorities.
The tax rates and tax laws used to compute the amount
are those that are enacted or substantively enacted at the
reporting date.
Discontinued operationsA discontinued operation is a component of the Group’s
business that represents a separate major line of business
that has been disposed of or is held for sale or distribu-
tion, or is a subsidiary acquired exclusively with a view to
resale. Classification as a discontinued operation occurs
upon disposal or when the operation meets the criteria to
be classified as held for sale, if earlier.
Consolidated statement of cash flowsThe consolidated cash flow statement is prepared using
the indirect method. Cash consists of current accounts with
banks and cash in hand. Payments of interest and income
taxes are included in cash flows from operating activities.
0
C. Kersten en Co. N.V. and our Strategic Partnerships
building a sustainable future annual report 2010
1
Risk Management and Internal Control
Our group Risk Management and Internal Control systems
are designed to provide reasonable assurance that the
Group’s business objectives are achieved. Our group Risk
Management and Internal Control framework is considered
in balance with our risk profile, although such systems can
never provide absolute assurance that material errors, losses,
fraud or violation of laws or regulations will not occur.
Risk profile and risk responsibilitiesManaging operational risk and other risks form an integral
part of the Group business operations. The Board of
Management of the Group is responsible for the design,
implementation and operation of the Group Risk Manage-
ment and Internal Control framework. The Board of
Management of the Group actively manages, to the extent
possible, the strategic, financial, compliance and operation-
al risks facing the Group.
Risk Management and Internal Control frameworkTo ensure risks are identified and managed and that objec-
tives are met in compliance with applicable law and regula-
tions, a risk assessment framework (RAF) is in place. This
control framework is based on policy documents, standards
and procedures. The main elements of the control
framework, our control activities, and monitoring into our
business practices are:
Company objectivesCompany objectives form the basis risk for the group Risk
Management and control framework. They are formulated
and communicated to the organization by the Executive
Board. All operating companies must operate in accordance
with these objectives. The company objectives are reviewed
at regular intervals and amended where necessary.
Risk evaluation and monitoringA risk management infrastructure is in place, which includes
periodical risk identification reviews and trough plan of the
Group. Our business strategy is regularly evaluated by the
Board of Management, Audit Committee and the Supervisory
Board; this also includes financial strategic, compliance and
operational risks.
Code of ConductOur Code of Conduct is based on Kersten’s core values. It
is intended to help each employee understand and follow
relevant compliance and integrity rules, and know when to
ask for advice.
Good timing… Dutch Soap TV serie at BergenDal
Planning and control cycleStrategic plans, budgets and forecasts are prepared at fixed times
during the year for all entities of the Group. Financial results and
other key performance indicators are reviewed monthly.
Accounting and reporting instructions The accounting and reporting instructions consist of instruc-
tions and guidelines for management reporting and external
financial reporting.
Healthy, Safety and EnvironmentKersten’s framework for Environmental, Health and Safety
includes policies, standards, which are in compliance with the
Inter-American Development Bank (IADB) Environmental and
Social Requirements and meeting World Bank HSE standards,
guidance materials, tools and activities to support and assist their
operating companies who manage environment, health and safety
at their sites and throughout key Kersten’s business operations.
Information management and security measuresInformation management is decentralized at Operating
Company level. At Holding level coordinating measures and
instructions are issued to assure univocal approach of infor-
mation management and security measures. Information
management and security measures.
InsuranceThe insurance policy covers risks resulting from property
damage, business interruption, employers’ liability and a
number of other specific risks. The insurance risk process and
monitoring for all Operating Companies is managed centrally
by C. Kersten en Co. N.V.
Internal AuditThe Internal Audit Department carries out operational audits
for the main Operating Companies based on the yearly Audit
Plan. The Audit Plan is based on the risk profile of Kersten.
Audit CommitteeThe role of the Audit Committee is to advise the Board of Directors
regarding internal control affairs based on the reports of the
Internal Auditor and its own observation.
Subsequent eventsPartnership Neal & Massy GroupIn 010 C. Kersten en Co. N.V. started a partnership with the
Neal & Massy Group by signing a Letter of Intent.
Neal & Massy Group is the largest publicly traded conglomerate
in the English-speaking Caribbean with over 80 years of experi-
ence. As of 011 the partnership with Neal & Massy Group will
enhance regional integration. It will also maximize the local
content from upcoming investments in Suriname by integrat-
ing a larger part of the private SME sector in the energy and oil
sector and thus promote productivity through industry clusters
and local development. Mining and energy are identified as
primary vehicles of development for the coming years.
Parnership SNT Nederland B.V.In 010 C. Kersten en Co. N.V. and SNT Nederland B.V., a
company domiciled in Zoetermeer, The Netherlands started a
joined venture (SNT Kersten).
SNT Nederland B.V. is the longest serving Dutch contact center
facility, founded in 1985 and an expert in call center services
and multi-channel customer call handling, both inbound
and outbound. This is done from their or at the customers’
location. With their services they help clients to build and
maintain effective contact with their (potential) customers.
SNT Nederland B.V. is one of the top in the outsourcing
industry and makes an important contribution to the profes-
sionalization and improvement of the call center industry.
Activities started in January 011 and the principal activities
of the SNT Kersten are focusing on inbound call handling.
The joint venture is doing the call handling for clients of SNT
Nederland B.V.
Change of group functional currency as of January 1, 2011As part of the continually Risk Management process, manage-
ment of C. Kersten en Co. N.V. evaluates the own business
periodically.
Based on the evaluation, management decided to change both
functional and reporting currency from Surinamese Dollar
into US Dollar in order to meet IFRS. The annual financial
statements for the year 010 are reported in US Dollars and
from January 1, 011, the functional currency of the Kersten
group is USD.
Independent Auditor’s report
To the shareholders and board of C. Kersten en Co. N.V.
We have audited the consolidated financial statements of C. Kersten en Co. N.V. and its subsidiar-
ies (the ‘Company’) for the year ended December 1, 010, from which these condensed consoli-
dated financial statements consisting of the condensed consolidated statement of financial
position, the condensed consolidated statement of comprehensive income, the condensed
consolidated statement of cash flows and explanatory notes on page up to and including page
were derived, in accordance with International Financial Reporting Standards.
In our auditors’ report dated April 18, 011 we expressed an unqualified opinion on those consoli-
dated financial statements from which these condensed consolidated financial highlights were
derived.
In our opinion the accompanying condensed consolidated financial highlights as of December 1, 010
are consistent, in all material respects, with the consolidated financial statements from which they
have been derived.
For a better understanding of the Company’s financial position and the results of its operations
for the period and of the scope of our audit, the condensed consolidated financial highlights
should be read in conjunction with the consolidated financial statements from which they have
been derived and our auditors’ report thereon.
Suriname,
April 18, 2011 KPMG Assurance Services N.V.
V.T.M. Bergisch RA
4
BUSINESS PERFORMANCE 2010General Change in presentation currencyFrom the year 2010 the consolidated financial statements are presented in United States dollars
(USD) instead of Suriname dollars (SRD). This change in presentation currency has been made to gain
a better insight in Kersten’s economic performance to the users of the financial statements, which
are mostly internationally oriented. Figures of preceding years have been recalculated in United
States dollars for comparison purposes.
Interest in joint venture Alexios N.V.On November 12, 2008 a share purchase agreement between the Company and Cementos Argos
S.A., a corporation established in Colombia has been signed. This agreement has been settled on
February 16, 2010. The Company sold on that date its ownership of 84.24% in Vensur N.V. to Alexios
N.V., domiciled in Suriname. At the same date the Company sold 50% of the shares in Alexios N.V.
to Corporaciones e Inversiones del Mar Caribe S.A.S, subsidiary company of Cementos Argos S.A.,
domiciled in Medellín, Colombia.
The principal activity of Alexios N.V. is administering the shares of Vensur N.V.
Due to the sale of the shares of Vensur N.V. in 2010, the assets, liabilities and results are propor-
tionately consolidated in the financial statements of the Group compared to full consolidation in
previous years.
Results of OperationsSalesConsolidated sales in 2010 were almost USD 64.8 million compared to USD 89.6 million in 2009.
The decline in sales of USD 24.8 million or 27.7% is caused by the decrease in sales of Heavy
Equipment, the dominance of import-duty exempted sales in the sales levels of Motors and
the proportional consolidation of Vensur. In 2010 all operating companies, with the exception
of Surmac and Vensur, realized higher sales, EBITDA and pre-tax results compared to 2009.
Sales USD (million)
2010200920082007
70.2 93.9 89.6 64.8
5
Cost of Goods Sold (COGS)COGS, as a percentage of total sales, slightly decreased from 69% to 65.%. The improvement
in the Cost of Goods Sold resulted from the change in the composition of the package of goods
and services sold and increased competition.
COGS/Sales (in %)
2010200920082007
67.3 69.6 69.0 65.3
Other operating incomeOther operating income, which includes lease income from third parties, revenue on fixed
assets sold and mooring vessels stabilized to USD 0.8M.
Employee benefit expensesEmployee benefit expenses slightly decreased to USD 8.M compared to 009 USD 8.6M due
to proportional consolidation of Vensur and higher cost efficiencies. The average number of
employees (in FTE) decreased from 561 in 009 to 59 in 010.
Employee benefit expenses in USD per employee
2010200920082007
11,847 14,187 15,300 15,250
DepreciationDepreciation increased slightly from USD 4.M in 009 to USD 4.4M in 010.
Selling, General, Administrative and Other Expenses (SG&A)Due to tight cost control, SG&A expenses were stable at USD 10.M. In terms of percentage of
sales, SG&A increased due to the mainly fixed character combined with the decrease of sales.
6
BUSINESS PERFORMANCE 2010
SG&A/Sales (in %)
2010200920082007
11.8 10.8 11.4 15.8
Total operating expensesTotal operating expenses slightly decreased by USD 0.M to USD .9M in 010.
Net operating profit marginIn 010, the net operating profit margin substantially decreased compared to previous years due to the
decreased sales and the fixed character of expenses. The decrease was deteriorated by the situation on
the Suriname foreign exchange market that led to positive exchange differences on transactions. These
exchange difference are presented as financial income. As a result, the net operating profit margin was
negatively impacted by approximately 1.%.
Operating profit margin/Sales (in %)
2010200920082007
7.2 6.8 5.9 0.6
Net financial expensesFinancial expenses slightly decreased in 010 from USD .5M to USD .M due to the amortization of the
Consortium loans.
Financial income increased by USD 1.8M to USD .M due to the sale of the 50% interest in Vensur (USD
1.0M) and the increase of exchange rate differences (USD 0.8M). In 010 the Interest Coverage Ratio
decreased to 4. times compared to 5.1 times in 009.
BUSINESS PERFORMANCE 2010
Income taxesKersten is a local company based on the legislation in Suriname and is an independent taxpayer only
for the corporate income. All the subsidiaries included in the consolidated financials of Kersten are also
independent taxpayers. As a consequence hereof no income tax is due on the consolidated income,
other than income tax based on the individual corporate results of the individual companies.
Net incomeNet income as a percentage of sales developed as follows:
Net income/Sales (in %)
2010200920082007
4.2 4.0 4.3 2.4
Operating efficiencyThe Cash Conversion Cycle slightly improved from 59 to 54 days.
The accounts receivable cycle increased from days to 54 days due to an agreement for longer terms
of payment with some major customers. Furthermore in some divisions longer payment terms were
granted as a penetration strategy.
The inventory cycle increased from 65 to 85 days due to a higher level of inventory in 010, mainly
consisting of heavy equipment meant for rental and parts kept to guarantee a certain service level for
customers.
The accounts payable cycle increased from 9 to 85 days due to the fact that the higher level of
inventory is financed through facilities from the suppliers involved.
8
Balance Sheet Summary
AssetsNon-current assetsProperty, plant and equipment decreased by USD .9M. Investments amounted to USD 5.0M including
the proportional consolidation of Vensur. Assets that are expected to be sold within the next year,
amounting to USD 4.6M were transferred to “assets held for sale”. Furthermore depreciation amounted
to USD 4.M.
Receivables decreased by USD 1.0M due to amortization.
Investment property decreased by USD .4M due to a transfer to “assets held for sale”.
Deferred tax assets increased by USD 0.5M and relate to income taxes regarding losses which are
carried forward.
Current assetsInventory increased, mainly due to heavy equipment meant for rental and higher parts levels.
Trade and other receivables slightly decreased by USD 0.8M. Trade receivables increased USD 0.8M,
while other receivables decreased by USD 1.6M due to amortization of a loan granted.
Other current assets increased by USD 0.9M due to the remaining amount from the partial sale of
Vensur. The amount is due after all legal obligations regarding the transaction are fulfilled.
Cash and cash equivalents increased by USD 1.M to USD 9.0M in 010.
Assets classified as “held for sale” regard assets that are expected to be sold within the next year.
The share purchase agreement between with Cementos Argos S.A. has been settled in February 010.
In the next year assets amounting to USD 6.5M are expected to be sold.
9
Equity and LiabilitiesCapital structureCapital structure was further strengthened. The leverage position, as measured by the Total Non-current Liabilities to
Tangible Net Worth ratio, decreased significantly from 8.8% at year-end 009 level to 69.9% at the end of 010.
EquityEquity decreased by USD .M. Equity attributable to shareholders decreased by USD 1.4M, being the balance of
the dividend of USD .0M paid to the shareholder and the addition of the result for the year 010 of USD 1.6M.
Non-controlling interest regards the minority share of third parties in Vensur. Due to the partial share and the loss for
the year 010, a decrease of USD 0. was realized.
Non-current liabilitiesLoans and borrowings decreased by USD .M due to regular amortization. Furthermore in 010 a mandatory prepay-
ment under the existing loan agreement took place originating from the partial sale of Vensur and other fixed assets.
An amount of USD .4M is expected to be repaid in 011 relating to assets held for sale and was transferred to current
liabilities. Other non-current liabilities slightly increased by USD 0.5M.
Current liabilitiesLoans and borrowings increased by USD .M including the above mentioned expected mandatory prepayment
regarding assets held for sale. Bank overdrafts increased by USD 0.9M to USD 5.6M as a result of credit facilities for
heavy equipment received by suppliers.
Income tax liabilities decreased as a result of lower taxable profit for the year 010.
Liabilities directly associated with assets held for sale decreased to nil due to the settlement of the share purchase
agreement with Cementos Argos S.A. in February 010.
BUSINESS PERFORMANCE 2010
40
BUSINESS PERFORMANCE 2010
Statement of Consolidated Cash Flows SummaryCash flows from operating activitiesNet cash from operations was USD 10.4M in 010 compared to USD 8.M in 009. The cash flow
in 010 was positively influenced by tighter working capital management. The cash flow in 009
was negatively influenced by the first adoption of IFRS’s.
Cash flows from investing activitiesIn 010 the cash flows from investing activities were positively influenced by USD 6.5M due to
the transfer of property, plant and equipment and investment property to assets held for sale
and the amortization of long term receivables by USD 1.0M.
Investments amounted to USD 5.0M.
Cash flows used for financing activitiesIn 010 cash flows used for financing activities was negative due to the repayment of the
Consortium loan, the partial sale of Vensur and the payment of dividend.
Net cash flow can be specified as follows:
-15
-10
-5
0
5
10
15
20financing activities
net cash flow
investing activities
operating activities
2010200920082007
(USD million)
-10.7
11.2
8.3
10.4
-6.2
-14
-4
1.41.4
2.9
-0.2
1.1
18.3
5.7
-4.5
-10.7
41
Headoffice C. Kersten en Co. N.V. Building constructed around 1875.
building a sustainable future annual report 2010
4
ABOUTC. KERSTEN EN CO. N.V.
Our Mission: Being the best through business excellence while creating sustainable long term value for our shareholders and at the same time maintaining a moderate risk profile, with due regard for the environment, the health and safety of our employees and the cultural heritage of Suriname.
Our Vision: Being the best and rapid growth accompanied by the best creation of value.
Supervisory BoardMr. David Voûte, Chairman
Mrs. Annemarie Hiralal-Norden, Member
Mr. David Roth, Member
Mr. Johan Stam, Member
Mr. Hugo Fernandes Mendes, Member
Mr. A. Pixley Sinclair, Member
Board of DirectorsMrs. Shirley Sowma-Sumter, Chief Executive Officer
Mr. Richard Tjon A Joe, Chief Operations Officer
Mrs. Shirley Sowma-Sumter, Acting Chief Financial Officer
Mr. Antoine Brahim, Chief Commercial Officer
building a sustainable future annual report 2010
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DIVISION STRUCTURE & BUSINESS ACTIVITIES
1. Building & Construction (Division Manager: Mr. Antoine Brahim)
1. CKC Bedrijven Exploitatie Maatschappij N.V. (BEM) Production of concrete products
2. Algemene Installatie Maatschappij (Alginco) N.V. Electro-technical-, air-condition-,
machine building, electronic parts and systems sale, installation and finance
3. Vensur N.V. Cement production
4. Spanbeton N.V. Production of pre-stretched concrete plates
2. Real Estate & Properties (Division Manager: Mr. Richard Tjon A Joe) 5. CKC Warenhuis N.V. Lease of real estate
6. Neptune Financiële Dienstverlening N.V. Financial Services
3. Motors & Heavy Equipment (Division Manager: Mrs. Shirley Sowma-Sumter)
7. CKC Motors Company N.V. and subsidiaries Automotive sales, rental, lease and financing
8. CKC Machinehandel Surmac N.V. Sale, product support, rental, lease and financing of construction,
agriculture and mining equipment, diesel and natural gas engines, and industrial gas turbines
4. Healthcare (Division Manager: Mr. Glenn Wormer)
9. CKC International Commodities (Incom) N.V. Trade in medicines, medical supplies and
medical equipment as well as consumer products
10. Surinam Laboratories (Surlab) N.V. Production and trade of chemical products
11. CKC Medicare N.V. Healthcare Services
5. Hospitality (Division Manager: Mr. Richard Tjon A Joe)
12. CKC Hotel Maatschappij (Krasnapolsky) N.V. Hotel operation and Franchises
13. BERGENDAL, Eco & Cultural Resort N.V. Eco Resort and Adventure Center
6. Kersten Communication Services (Division Manager: Mr. Richard Tjon A Joe)
14. SNT Kersten N.V. Communication Services
7. Holding Services (Division Manager: Mrs. Shirley Sowma-Sumter)
15. N.V. Handelmaatschappij S.M. Levie Registration of trademarks and intellectual property