Rain melts Kremi ice cream revenue
Caribbean Cream Limited, which trades as Kremi Ice Cream, blamed the heavy rains for flattening its revenues during the May quarter.
Sales grew by one per cent to $319 million in the first quarter. Profit was sliced in half from $71 million to $35 million.
"Sales were affected by the reduction in demand due to adverse weather conditions, rain and flooding, existing in the first quarter of our financial year," said Kremi chief executive Christopher Clarke and chairman Carol Clarke Webster in a statement to shareholders.
The company's cost of doing business spiked in the quarter due to pricier ingredients, storage and shipping, and higher utility costs due to increased storage space. The ice cream maker also paid higher salaries in the period.
Last September, Kremi announced plans to invest $200 million to improve operations and dress up its expanded space in its Kingston plant, and to complete the expansion of its production space by 50 per cent at a cost of $170 million.
During the May 2017 quarter, the company spent $38.3 million on the acquisition of fixed assets, up from $24.6 million a year earlier. For its full financial year ending February 2017, the company spent $112 million on such acquisitions.
Kremi currently owns and operates three depots located between Montego Bay and Kingston. The company makes bulk ice cream products and frozen novelties. It also distributes the Flavorite brand of frozen novelties from Trinidad.
In the past three years starting shortly after going public and listing on the Jamaica Stock Exchange Kremi sales have topped a billion dollars, hitting a new record of $1.2 billion in the last period.
The stock, which debuted at $1 four years ago, peaked at $10.75 last September, but is now trading at $6.60 on the junior stock market.