Se­prod re­boot pays off at the bot­tom line

Jamaica Gleaner - - BUSINESS - Steven Jackson Se­nior Busi­ness Re­porter steven.jackson@glean­erjm.com

FOOD CON­GLOM­ER­ATE Se­prod Lim­ited made $126.8 mil­lion net profit for its third quar­ter, re­vers­ing losses from a year ago.

Over nine months end­ing Septem­ber, the com­pany earned $942.8 mil­lion. That’s up 151 per cent year on year, a per­for­mance re­flect­ing ben­e­fits from new prod­ucts launches, sugar sales and the re­duc­tion in sugar plan­ta­tion ex­penses.

CEO Richard Pandohie said the thirdquar­ter per­for­mance was “sig­nif­i­cantly bet­ter” with a 10 per cent in­crease in rev­enue and a sig­nif­i­cant turn­around in profit be­fore tax and earn­ings per share.

“The com­pany’s ex­port port­fo­lio, led by sugar to the CARICOM mar­kets, has grown by more than 35 per cent. The in­no­va­tion pipe­line in the dairy op­er­a­tions is flow­ing nicely with the com­pany launch­ing lac­tose-free milk, evap­o­rated milk and sweet­ened con­densed milk in 2016. The em­pha­sis in im­prov­ing pro­duc­tiv­ity is bear­ing fruit and the Se­prod team re­mains com­mit­ted on this path as we strive to en­sure that our op­er­a­tions are glob­ally com­pet­i­tive to drive ex­port sales and im­port sub­sti­tu­tion,” he said.

JA­MAICA GRAINS FAC­TOR

Over nine months, Se­prod rev­enues at $11.1 bil­lion ac­tu­ally dipped from $11.2 bil­lion, due to price re­duc­tions.

“De­spite a mar­ginal re­duc­tion in rev­enue driven by the com­pany re­duc­ing prices of bis­cuits to con­sumers and the re­moval of Ja­maica Grain’s rev­enue from the con­sol­i­dated re­sults due to its new sta­tus as an as­so­ci­ated com­pany, the com­pany gen­er­ated ro­bust in­crease in both gross profit and profit be­fore tax,” said Pandohie, adding that it’s in­dica­tive of im­proved ef­fi­cien­cies that arose from sig­nif­i­cant re­tool­ing of most op­er­a­tional units.

The re­tool­ing in­cluded the in­stal­la­tion of a new pack­ag­ing line at Serge Is­land Dairies, in­stal­la­tion of an ir­ri­ga­tion sys­tem at Serge Is­land Farms and the Richard Pandohie, CEO of Se­prod Lim­ited.

in­stal­la­tion of a new oven at In­ter­na­tional Bis­cuits. Ad­di­tion­ally, the re­struc­tur­ing at Golden Grove Sugar fac­tory cou­pled with it be­ing granted mar­ket­ing agency sta­tus from the Gov­ern­ment has al­lowed it to re­duce its losses by more than half.

“The strong per­for­mance of the in­vest­ment port­fo­lio has also

con­trib­uted to the more than dou­bling of the profit be­fore tax over prior year,” stated Pandohie.

At the end of Septem­ber, Se­prod re­ported group eq­uity of $11.4 bil­lion on to­tal as­sets of $12.7 bil­lion.

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