"Earnings for the first six months ended 31st July 2002 amounted to only $60,859 compared to $166,900 in the first half of last year, a decrease of 63.5%. The decrease in earnings is mainly due to lower sales and an increase in operating costs. Sales for the first six months of this year are down $123,322 or 6.25% when compared with last year. Operating expenses, such as salaries, repairs and maintenance experienced a significant increase in the first six months, negatively affecting our earnings.
Mr. Frank Suess was appointed General Manager 1st June 2002. At the end of July Doug Chase returned to the U.S.A. and we appointed a new Operations Manager, Eugene Bell, who has since left us. Our new management is working hard to improve the competitive position of the Company and to increase sales and profits. Already, their hard work has resulted in August sales increasing by 10.6% compared to same month last year. We hope this level of performance will be maintained for the remainder of the year.
On 15th April 2002 we paid a dividend of $0.10 per share to shareholders of record 5th April 2002. At the Directors Meeting held today, a further dividend of $0.10 per share was declared payable on 15th October to shareholders of record 30th September 2002.
In our Annual Report to Shareholders issued in May, we stated that it was our intention to continue to buy in shares of the Company for cancellation; to the extent we have surplus funds available, with the view to reducing the shares outstanding to a more acceptable level. During the year ended 31st January 2002, the Company repurchased a net of 16,931 of its own shares at an average price of $5 reducing shares outstanding to 598,000. Since the end of the last fiscal year, we have purchased an additional 300 shares further reducing the shares outstanding to 597,700 as at 31st August 2002.
At 31st July 2002 cash resources amounted to $677,518 and payables were $297,727. There are still some fairly major repairs and improvements to the facilities to be carried out such as the refurbishment of the dining area and improvement of the layout in order to facilitate more efficient service."
Signed by:
Donald P. Lines
Chairman