2006 - Eastern Caribbean Securities Exchange

Chairman’s Reviewrecovering to cross the $7.00 mark by 31st December.The absence of institutional investors as buyers fromthe Trinidad and Tobago Stock Market meant that themarket was largely driven by speculative activity on thepart of individual investors. This resulted in increasedvolatility which tended to be even more pronouncedin the environment of the automated trading platformintroduced by the TTSE in 2005.Apart from the bearish market, the main factor affectingTCL’s share price was the Group’s disappointingpublished consolidated results for the first and thirdquarters 2006, which were below expectations largelydue to the claims expenses arising from the productquality problems at Caribbean Cement in Jamaica.The Group also incurred the higher costs of importedclinker to make up for a shortfall against plannedproduction in the face of buoyant regional demandfor cement.We are confident that these problems are now behindus and the outlook for 2007 remains positive. YourBoard remains committed to increasing shareholdervalue over the medium to longer term. In this regardsacrifices have been made in the short term in order tobetter position the Group for longer term competitiveadvantage. This positioning is expected to positivelyimpact shareholder value over the medium to longerterm.Another initiative taken to improve shareholder valuein 2006 was the listing of TCL’s shares on the EasternCaribbean Securities Exchange (ECSE) and the GuyanaStock Exchange (GASCI) in the fourth quarter. Thisis consistent with our strong regional profile and itwill expand the pool of potential shareholders bymaking our shares more readily accessible across theCaribbean. With a more efficiently functioning systemof cross border trading, pockets of excess supply inshares in any one market could be utilised to satisfydemand in other regional markets. Ideally this is likelyto reduce volatility in individual markets and enhanceshareholder value over time.The Board’s FocusDuring 2006, your Board, in addition to providinggeneral direction, focused its attention on providingoversight in the major areas of risk exposure forthe Group. These are: our Capacity Expansionand Modernisation Programme, our Financialand Accounting systems and our Human CapitalDevelopment. The three Board sub-committees, whichhad direct responsibility for these areas, the BoardTechnical Committee, the Board Audit Committee andthe Group Human Resource Committee, were veryactive in fulfilling their respective mandates. A listingof the composition of the Board sub-committees isprovided on page 8.Board ChangeMr. Darcy Boyce joined the TCL Board with effectfrom 29th September, 2006, to fill a casual vacancy.Mr. Boyce’s appointment was effected in accordancewith Clause 4.4.2 of By-Law No. 1 and is subject toconfirmation at the upcoming Annual Meeting.Mr. Boyce is the Chief Executive Officer at BarbadosTourism Investment Inc. His bio-data is included onpage 12 of this report.AcknowledgmentsThe Group has had a better year in 2006 than 2005,notwithstanding the issues faced in Jamaica. Onceagain, I wish to thank my fellow Board members fortheir support and diligence, and the Group CEO andhis very committed team for their dedication in themidst of very difficult circumstances. I also wish tothank all of our stakeholders for their support. TheGroup is clearly poised for much greater success andwe look forward to continued support.Andy J. Bhajan, Group Chairman22