Some businesses see improved bottom lines and potential growth in coming year but not everything is rosy
By Oyaol Ngirairikl
A blind survey conducted amongst businesses participating in the 2022 Bank of Guam ASC Trust Top Companies of 2022 shows that many businesses remain hopeful that bottom lines will improve in the upcoming year. That bullish attitude arises from anticipated construction related to the military buildup, the island’s improving technology network, and the potential increase in tourism.
Looking ahead, of the businesses that participated in the 2022 survey and answered the question “One year from now, I expect my company’s bottom line to be …”, about 81% said they are expecting their bottom line to improve. Breaking that down, 25% said they expect their bottom line to be “much better” and 56.25% said “somewhat better”.
A similar hope in 2021 was voiced by a majority of respondents. In response to the question “One year from now, I expect my company’s bottom line to be…” 80% of respondents said they expected 2022 to be an improvement:
- “much better” — 15%
- “somewhat better” — 65%
- “about the same” — 20%
- “somewhat worse” — 0
- “much worse” — 0
And it looks like that hope was realized for many of the businesses. In the 2022 survey, 62.5% of respondents said their economic expectations for their organizations were fulfilled. Additionally, a majority of the businesses, about 75%, said bottom lines did improve.
Those improvements are also reflected in the 2022 survey as a majority of businesses said their staffing numbers increased (31.25%) or stayed the same (37.5%).
But not every business experienced a good year. To the survey question on economic expectations, 37.5% of respondents said economic expectations weren’t met. Reasons for unmet expectations focused on tourism and construction. The speed with which the economy in general is recovering or responding to the challenges posed by COVID-19 was also a factor.
One respondent remarked, “The economy is still weak; tourism hasn’t recovered.”
Similarly focused, another response was, “COVID-19’s impact remains due to quarantine requirements from our neighboring countries. While most countries have removed the quarantine, the strong U.S. dollar makes (it) harder to compete with other cheap destinations. The freight cost increase, labor and resources shortages, etc. are the challenges we have to face.”
On the construction side, one response was, “Federal construction delays and Saipan tourism rebound taking too long.” Another response to the survey question was that new construction projects had a “slow start.”
Similarly, some businesses weren’t so optimistic as they looked forward. The survey asked participants to respond to the following sentence: “I believe the economy will provide specific opportunities for my business in the coming year.” One businessperson said they “don’t see any good opportunity” in the coming year “unless the government is willing to invest on the tour sites and create more attractions. Otherwise, it will be another challenging year ahead of us.”
The Guam Visitors Bureau, in October, announced that arrivals for fiscal 2022 finished with 216,915 visitors. The agency touted the increase compared to fiscal 2021, up by 388.7%. Agency officials, however, also noted that visitor arrivals were only 13.3% of what the pre-COVID-19 numbers in 2019 were when Guam welcomed more than 1.6 million tourists.
“We’re still on this long road to recovering our number one industry, but the strides we’re making with our airline partners, travel trade, and tourism-related businesses are getting us closer to our goals,” GVB President and CEO Carl T.C. Gutierrez said in response to the fiscal 2022 numbers.
During a recent Guam Industry Forum hosted by the Society of American Military Engineers conference local and military officials discussed construction projects both on and off military installations. While concerns were raised by conference participants regarding the lack of skilled workers, federal policies regarding the onboarding of foreign skilled workers have relaxed somewhat, helping to ease the labor force shortfall felt in the last few years – even prior to COVID-19.
They hope that improvements in tourism and construction industries will continue drive some of the positivity behind 2022 survey participants’ responses. In addition to the majority expecting improved bottom lines in the coming year, 75% of respondents said they expect to increase staffing numbers in the coming year with 18.75% saying they expect to maintain staffing levels. Only 6.25% said they anticipate a decrease.
Additionally, 75% of survey respondents said they believe the economy will provide specific opportunities for their businesses this coming year. One business cited construction as the opportunity. Another said, “More fuel demand from economic recovery/ tourism.”
Other positive responses, included:
- “Rebounding of tourism numbers and the expansion of the military build up will undoubtedly increase sales and rental opportunities.”
- “Tourism in Saipan and federal work on Guam.”
- “Buying, merging, expanding opportunities for companies with positive cash flow.”
- “Buildup and Guam growth in general.”
- “Increased demand for IT equipment and broadband infrastructure services”
- “Adjusting to the new normal and providing solutions by working with other local businesses”
One respondent pointed out a potential opportunity based on a not-so-positive reality that perhaps sounds a warning to all. “Venturing into real-estate as sadly, many may lose their homes due to 2021’s excess cash and lack of financial discipline.”
This year’s List includes the full rankings of top companies in the region, responses from company leaders on what they learned in this past year, and economic assessments by Joaquin Cook, president and CEO of Bank of Guam, and David J. John, CEO of ASC Trust LLC.
Guam Business looks forward to again welcoming companies on the list next year from all industries throughout Micronesia.
What have you and your company learned by doing business during the past year?
Editor’s note: Companies participating in this year’s Top Companies Survey were asked what they have learned throughout 2022. The following are responses from some of the lead executives.
Muna “Retention is a challenge and over this past year, I have learned how important it is to value and invest in my employees.” Annmarie T. Muna |
Shimizu “The company’s most important asset is our staff. We thank our employees for their support and patience during these past two years.“ Frank S.N. Shimizu |
Bonsembiante “The high demand for engineering and construction services forces companies and clients to find different contractual arrangements in order to maximize the utilization of resources.“ Hernan Bonsembiante |
Yap “Our successful acquisition of Morrico Equipment and the Avis, Budget, and Payless rental car brands bring unique opportunities. The only way to capitalize on these opportunities and continue our growth in the region is to develop our people and continue our practice of inclusion and diversity in our workforce.” Kwok Wai “Alex” Yap |
Cook “One of the most important things our company learned in the past year was that change is hard, but necessary and remaining flexible and open to new ideas and ways of doing business is a huge part of success.“ Joaquin P. L.G. Cook |
Ho “Bank of Hawai‘i has been serving the West Pacific region since 1961, and we are just as committed now as we were then. As we celebrate our 125th anniversary in the islands of Hawai‘i, we also celebrate our customers of the West Pacific. Doing business is about people—building longstanding relationships with those in the community to help them thrive. We look forward to helping businesses and organizations emerge even stronger from the pandemic. Our West Pacific employees are not only dedicated to their work inside the branches, but also as volunteers. Part of their service this past year has been volunteering as financial advisors for Junior Achievement and teaching financial education inside schools through SmartMoney Lesson Day. In celebration of our anniversary, our West Pacific region employees supported the bank’s sustainability efforts by planting trees with the University of Guam and the Mariana Islands Nature Alliance. Additionally, our Bank of Hawai‘i Foundation made a $125 donation to the nonprofit of choice for every BOH employee.” Peter S. Ho |
Edwards “Bank of Marshall Islands celebrated its 40th anniversary this year and hopes to continue to provide and create more financial services and products to meets customer’s needs.” Velma Edwards |
Deliquina “We learned new and more impactful ways to care for our human resources so that the philosophy of people helping people for which credit unions were founded will carry on our mission to provide exceptional service, not just during challenging times, but always. We learned that thriving as a people will keep our community resilient and prosperous against all odds.” Gener F. Deliquina |
Cruz “The rising costs over the last 12 months reminded all of us how important it is for government leaders to understand economics.” Gerard A. Cruz |
Eun “Meeting and working with people together is life.” Ho S. Eun |
Hazzard “A company must be resilient during adverse events (weather, illness etc.) by having plans in place to adjust so the mission can continue unabated.“ Charles B. Hazzard, III |
Alcorn “Our on Island businesses have really not improved this past year, it’s going to be much more difficult to sustain or grow sales for our current retail restaurant business, inflation and smaller customer base has made it challenging, however we are starting to see new opportunities in our DOD contract lines and per-solicitations for General Blas Base.” David A. Alcorn |
Sutton “The wellbeing of employees is important to a successful business.” Aaron Sutton |
Walls 2021 Mantra: “Practice Ikigai Kaizen.” Develop a fulfilling business purpose and then learn daily how to make it better.” Peter W. Walls |
Certeza “The pandemic amplified the urgency to improve service levels. Despite the challenging market conditions triggered by the pandemic, we continue to expand our digital infrastructure and make network investments needed to develop and grow our operations.” Roland Certeza |
Sugie “Be patient and flexible, closely monitor every single aspect and be willing to adapt and prepare for unpredictable challenges.” Hiroki Sugie |
Jones “As we transition from the momentum of the pandemic, we have learned to take on the e-route technology of doing business by embracing E-Commerce. This medium has become synonymous for the expansion and staying power of business in the modern world.” Ramona Lea Jones |
Scragg “It was an exciting year; we had some difficulties and challenges, but we managed to overcome them. JWS is comprised of team members who work together in harmony for success in a variety of ways.” John W. Scragg |
Hau “As our island comes out of the pandemic, we have learnt to better adapt to provide safe and reliable supplies of essential fuels to the community and improve our service offering to our customers. I’m proud of the Mobil team and all Mobil Service Station personnel as we achieved this while keeping our employees, contractors and customers safe.” Jimmy T.C. Hau |
Quinata “One of the most important things we have learned doing business in the last year is that if you build a solid foundation and are flexible enough to adapt to ever changing market conditions you will make it through stronger and with a better focus on how to deliver the best products and services to your customers.” Derrick Muna Quinata |
Maloney “While the times we are living in continue to present challenges, they also tend to serve up opportunities in equal measure. Progress comes from learning to extract the value to be found in both.” Robert J. Maloney |
Kramer “Challenging times are inevitable but not impossible, it’s during those times you are reminded that building your team has been the single most important investment you have made.” Daniel Kramer |
Stewart “This past year has been a year of transitions and working on identifying the needs in the region and looking for strategic solutions to meet those needs. We began focusing on the initiatives to help revitalize the economy post-COVID-19 by teaming with Southern Airways to form the Marianas Southern Airways, an inter-island airline connecting Saipan, Tinian, Rota and Guam. Our construction companies have also looked for ways to provide solutions to our clients amidst the rising costs and the supply chain issues. We have also found ways to diversify by acquiring Paradiso Resort & Spa and expanding our Equipment & Fleet rental operations. Overall, this past year has taught us that there’s opportunity for growth post-COVID-19 if we as an organization will have the vision and the courage to execute.” Keith J. Stewart |
Calvo “Revenue growth was strong in our retail/wholesale divisions. Though the pandemic caused a great disruption to the island community, nearly $3 billion in federal pandemic assistance over the past few years stabilized what could have been a major societal upheaval including supply chain issues. Wholesale operations saw increases in mom and pop stores volume in Guam, and expanded markets outside of Guam, particularly in military sales. Fortunately, for federal rental assistance programs, the vast majority of our commercial and residential tenants were able to continue to keep current on their rental payments.“ Edward J.B. Calvo |
Smith “When we made the move to Guam back in 1992, we had a clear vision: to provide integrated construction solutions to military and private clients while creating meaningful connections, activities, and services to the Guam community. We are island proud and love supporting local government, charities, and associations. Looking back over 30 years, it’s been wonderful to see the momentum the team has built over the years — and that original vision remains just as important today.” Albert Smith |
Dean “Few tourist arrivals make for a tough business environment. Douglas R. Dean |
Beery “With the past 2-3 years of uncertainty in the supply chain’s pricing and performance for needed resources here in Guam’s construction industry, it requires “better and best” planning and scheduling for our project delivery requirements along with communications of such information with our clients.” William Beery |
