Fri | Oct 19, 2018

Seprod forecasts flat results

Published:Friday | August 25, 2017 | 12:00 AM
Jermaine Barnaby/Photographer This July 2017 photo shows new silos being developed by Seprod group member Jamaica Grain and Cereals Limited near the port. Seprod projects that new investments will boost its financial results by year end.

Food manufacturer Seprod Limited expects its results to remain flat for the remainder of the year.

"The guidance remains unchanged and management expects that the 2017 operating results will be on target to be the same as 2016," the company said at the release of its second-quarter results.

The company under-performed in the June quarter when profit fell to $179 million, representing a third of the $594 million out-turn reported in the June 2016 period. However, the latter period was boosted by a one-off gain from the sale of its GraceKennedy shareholdings. The company indicated that even when discounting for the one-off gain, the results for the current period were still slightly lower than planned.

Seprod sales rose by $200 million to top $4 billion in the quarter. Over six months, revenue amounted to $8.4 billion, compared to $7.6 billion the previous year. Profit at half-year amounted to $462, or just over half of the $816 million made by the company in 2016.

The fall in profit "so far is six per cent below plan, primarily due to lower-than-expected sugar production caused by abnormally high rainfall that affected the cane harvesting," Seprod said.

However, the company said it expects to make up the deficit, especially with the manufacturing investments to come online in the fourth quarter and expectations of a significant uptick in the export business.

In 2016, Seprod made annual profit of $875 million or $2.11 per share. Topline income amounted to $15.78 billion.