Wehby delivers 122% profit growth in first quarter as CEO

GraceKennedy Limited has reported improvement in both revenues and profits for the first nine months of its financial year, with net profit attributable to owners of the company moving up 122 per cent in the third quarter ended September 30, on the back of excellent results across its five reporting segments.

This compares with an increase in revenue of 3.2 per cent and a marginal decline in profit of 2.1 per cent in the first six months of its current financial year when banking, insurance and investments showed a decline year over year.

The company said shareholders will receive an interim dividend totalling about J$165 million, or 50 cents per stock unit, an 11 per cent increase over the $148 million, or 45 cents per stock unit, paid out during the corresponding period last year. The dividend payment will be made on December 16.

In a report accompanying the unaudited results for the third quarter and presented to investors at an online briefing in Kingston on Monday, chief executive officer Don Wehby and executive chairman Douglas Orane said for the third quarter, the group achieved revenues of J$14.8 billion, an increase of J$1.39 billion, or 10.4 per cent over the corresponding period last year.

The period marks Wehby's first quarter as CEO.

Increased net profit

Net profit attributable to owners of the company increased by J$387 million compared to the corresponding period of 2010, moving from J$317 million to J$704 million, an increase of 122.1 per cent.

Over the nine-month period, the group achieved revenues of J$43.8 billion, an increase of J$2.29 billion, or 5.5 per cent. Net profit attributable to owners during the same period increased by J$372 million, or 24 per cent to J$1.92 billion from J$1.55 billion.

"The GK Foods Division had good results for the third quarter, despite our operations being affected by higher-than-expected increases in raw material and energy costs," said Wehby.

"In order to counteract these increased costs, we continue to seek new and improved sources of raw materials as well as more efficient operating systems and equipment," he said.

The food division was the main contributor to the company's results, with revenues up by J$3 billion and profits increasing by 73.4 per cent due to increased sales in both the local and overseas markets.

Wehby also noted the company's continued expansion in North America through the strengthening of existing channels, and the development of new ones in the United States and Canada.

He also referred to GraceKennedy's operations in the United Kingdom which, he said, was "focused on further growth in the existing market and building its capability to execute on export opportunities in Europe and Africa".

The CEO said the money-services segment continued to do well, recording increased profits for the quarter, due in large part to increased volume at GraceKennedy Remittance Services Limited which took over bill collections within Jamaica Public Service locations in January, as well as GraceKennedy Payment Services Limited.

mcpherse.thompson@gleanerjm.com