Source: Jamaica Gleaner
Seprod Limited’s offloading of property in Kingston has netted $762 million, but even absent that gain, the company is on track towards a bumper year.
Seprod sold the former Industrial Sales complex to the Epply Caribbean Property Value Fund, with which it is affiliated. Both entities are members of the Musson Group.
Seprod made operating profit of $3.8 billion over nine months ending September, up from $2.2 billion in the year-prior period.
Earnings climbed to $2.53 billion, or $3.44 per share, from $1.16 billion, or $1.58 per share.
“That is why we were very clear in separating it out of the rest of the numbers. The operating performance is much better. We always expected that, and we see this going forward as one of our best years,” Pandohie told the Financial Gleaner.
“Even with COVID, we have seen an improvement in revenues. The pharmaceuticals are doing well. In addition, a lot of the products in our portfolio are basic products that consumers want to buy,” Pandohie said of portfolio brands like Gold Seal flour, consumer foods Eve, Geddes and NuPak, and a range of milk products, juices and biscuits.
Sales grew by $3.5 billion over nine months to $28.6 billion, a gain Pandohie attributes to the more aggressive sales techniques, with boots on the ground. He adds that the fourth quarter is also shaping up to deliver additional gains.
“Our approach to this pandemic has been ‘go hard or go home’, so to speak. The team has just decided to roll the dice and go out there with total aggression. We believe that there are opportunities opening up and our goal is to come out of COVID-19 better than we went in,” he told the Financial Gleaner.
Notwithstanding the gains, the company’s stock has traded down 1.3 per cent since Monday to $58.74 per share.
Seprod exited its perennial loss-making sugar manufacturing operation at Golden Grove, St Thomas, in July 2019. At the nine-month mark last year, sugar was a $786-million drag on profit, with additional straggling costs of $47 million booked this year.
Pandohie said if the company hadn’t taken the decision to exit the business, Seprod would have been chalking up yearly losses of $400 million.
Amid the sale of the Industrial Sales property, the reforms at the company also sees it building out a larger distribution and logistics operation.
Having acquired Facey Consumer, a deal struck with yet another Musson Group member, Seprod is now spending $2.5 billion to develop what it describes as a ‘logistics campus’, inclusive of new warehousing facility.