Paramount returns grow amid recruitment
Lubricants company Paramount Trading Jamaica Limited more than doubled its first-quarter profit, boosted by a nearly one-third spike in revenue.
CEO & Managing Director Hugh Graham is attributing the top line gains to new hire Gary Dixon, whose recruitment as chief revenue officer was disclosed during
Sales at Paramount grew from $253 million to $331 million in the quarter ending August, a 31 per cent gain, while profit climbed from $15 million to $34 million, up 126 per cent.
"There was a move to strengthen the leadership team and in doing so, we changed the structure from the typical British structure to a US model where we have a chief revenue officer, so that everything that has to do with driving revenue comes under one person," Graham said Tuesday.
Dixon was recruited away from rum king J. Wray & Nephew Limited. Graham also snagged Gregory Wildman, the former chief financial officer at Digicel Play as his new CFO. He was brought on-board October 2.
Graham says his push to strengthen the leadership team is based on a board directive that: "If you're investing in block and steel, then you must also invest in the human resources."
The company is shifting into the blending of lubricants in partnership with Allegheny Petroleum of the United States. Their new plant at Waltham Park Road in Kingston was expected to be commissioned this month, but that date has been pushed back again.
The investment in new talent is driving up expenses for the company administrative costs jumped from $44 million to $63 million in the quarter but Graham insists it is money well spent, given the company's growth ambitions.
" ... It is a case of doing more than managing what we have and putting in some stronger muscles to deal with the reality of where we are going," he said. "You can put in the investment, but if you don't have the personnel to extract the efficiencies out of the investment, then it's just money spent."
Graham had predicted in August that Paramount should see a 22 per cent increase in growth profits. The first-quarter increase was actually 22.7 per cent.
"Personally, I feel good about this performance, because this is the first time that we are doing better than our budget. We've done well in the past, but now we are doing better," the CEO said.
The new blending plant will produce Altra lubricants, a brand owned by Allegheny. Graham acknowledged that several deadlines have been missed for the US$4-million plant, but says he is now looking to pass the finish line.
"Yes, we're more than a little behind on that, but the technicians from overseas are here doing their 'buttoning up', so to speak, and we should have the plant up and running in short order certainly with the new calendar year coming up," Graham said.
"Shareholders will be happy when they see what we have done. We may have been a little ambitious to put the timeline that we did, because we never considered that all things are not in our control," he said.