$1.2m profit at Polaris as CEO hails changes
Greater productivity and efficiencies at Hamilton docks have been key to Polaris Holding Company recording a full-year profit of $1.22 million.
It is the second consecutive year that the parent company of Stevedoring Services Ltd has posted positive figures above $1 million.
“In just two years Polaris reined in debt and cut spending; trimmed fat and built bridges, strengthening relations with staff, customers and other stakeholders,” said Cheryl Hayward-Chew, chairwoman of Polaris.
“Polaris invested in infrastructure and training, and through mutual respect, positive reinforcement, and a creative forward-looking focus, a company that a handful of years ago was ridiculed and written-off, has now been reinvented.”
The turnaround is remarkable in light of three years of straight losses from 2013 to 2015, which included a near $2 million loss in 2014.
In the year to the end of March, the company achieved 36,806 movements of 20ft equivalent containers — the highest number since 2010-11. Stevedoring revenue hit $10.9 million, higher than any of the past six years.
Earnings per share were $1.03, slightly down from last year’s $1.16. Polaris, which also owns Equipment Sales and Rentals Ltd and Mill Reach Holdings Ltd, is now debt free having settled its long-term loan.
The company was once blighted by stoppages and industrial unrest. Today it holds itself up as an example of what can be achieved through collaboration, dialogue and shared sacrifice between management and workers; so much so that it feels it can act in an advisory role to other businesses and organisations seeking to overcome similar challenges.
That, and its proven logistical and cargo-handling expertise, are avenues it is exploring as it looks to broaden its opportunities.
Warren Jones, chief executive officer, is proud of what has been achieved by the company during the past three years. He confidently states that when Hamilton is compared to the island’s other port facilities at St George’s, Dockyard and Morgan’s Point: “No one can do it better than us when it comes to shipping. We have the history and the customer support. No one can do it safer or more efficiently.”
Pointing to the financial results, which follow a $1.4 million profit in 2016, he said: “This is the second year in a row that we have been profitable. That starts to represent stability for a company that everyone once looked down on.
“When I came four years ago everything was broken, customers wanted out, the relationship between staff and workers was not working, and equipment did not work.”
Mr Jones is a former permanent secretary at the Ministry of Health, and was permanent secretary for Education when he was tapped for the CEO role at Polaris in late 2013. He knew he would face major challenges by taking the job, but he was prepared and willing to do so.
“I’m the person who likes difficult things,” he said, recalling the state of affairs four years ago when workers “would be downing tools at the drop of a hat”.
The economic downturn that affected Bermuda from the late 2000s until 2015 also dealt a significant blow to Polaris.
However, the company reacted to pain points of the recession by looking internally at how it could change its operations, and that included cultivating better relationships between unionised workers and management.
As a result, the docks are no longer the flashpoint for industrial action they once were. While outside disputes have occasionally affected dock operations, internal issues have been dealt with behind the gates, and through dialogue.
“The focus is on getting the job done. There is trust; the staff know they do not need to take action to get something done,” said Mr Jones.
Explaining how things have been turned around, he said: “It has been about investing in the things that we need. We started off by working on the relationship between workers and management.
“We believe the union is a partner, and they believe we are a partner. We both want the company to be profitable. We have created a good relationship.”
Polaris invested in new equipment to improve efficiencies, and opened lines of communications with workers including a monthly “state of the company” report that shows how the business is performing towards end-of-year targets.
The report includes a list of anomalies where the company has incurred unexpected, or higher-than-expected, costs. This is often an open talking point between workers and management, and a place where problems are addressed and solutions found.
As an example, a high rate of tyre blowouts on dock vehicles can soon mount up. When workers see the problem they might question the cause and suggest remedies.
“Every staff member knows how we’re doing. They know how efficient we are. They get a copy of the monthly financials, which includes how much we pay out for damages; at the moment it is one-tenth of 1 per cent of what we bring into Bermuda.
“Our guys work well and safely. They know how much we bring in each month, how many containers.”
Polaris also has minimum-level service agreements with the shipping lines, which means if it does not achieve that level when it comes to the timely loading and offloading of containers, it has to compensate the shipping lines an agreed amount. Polaris’s workers are currently working well above the minimum level, as is shown in the one-page monthly financial report shared with employees.
There is a clear incentive to achieve and maintain a harmonious working environment and collaborate to improve safety and efficiency, because if the company reaches its end of year targets that feeds into future wage agreements.
Where Polaris has had to trim its workforce it has been shared sacrifice. For every worker who had to go, so has a member of management. Headcount reduction have been achieved mostly through natural attrition.
An internal survey conducted this year found that 100 per cent of employees who responded took pride in their job and understood their job’s importance to the wellbeing of Bermuda. The survey recorded that 93 per cent of respondents were satisfied with their job.
The company has given training opportunities to workers through the Caribbean Maritime University, leading to internationally recognised qualifications.
The America’s Cup also created opportunities for Polaris to show its abilities at Hamilton docks and beyond. Almost everything that shipped to the island for the event, and then shipped out, was handled by the company. It provided offloading services at the America’s Cup Event Village and Morgan’s Point. And it acted as America’s Cup Bermuda manager of the Front Street superyacht marina.
From April until Cup Match weekend at the beginning of September, the dock crews worked shifts that covered every weekend in order to fulfil the logistics and demand of the sporting event and the regular workload.
Mr Jones said staff show initiative and get the job done.
“We don’t have to chase them onto jobs. The staff understand that Bermuda depends on us. The change has been getting everyone rowing in the right direction.”
Looking to the future, he said: “Our business wants to grow. We are not where we want to be yet, but we are also not where we were.
“We have proven that the union is not an entity out there to be feared. We have systematically shown that we can make [the relationship] a success. If there is any entity in Bermuda that we can invest in them, or if there is an entity that has a problem, we have a template that has worked over the last few years.
“We can take our business model with training and getting efficiencies and transfer that to all businesses in Bermuda.”
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