First, Hurricane Sandy ravaged Jamaica Producers Groups agricultural fields; and then it pummeled its profits.
Jamaica Producers profits to J$208 million at year ending December 2012 or one-quarter the J$995 million made the previous year.
The group earned 90 per cent of its profits from none-core activities led by its investments in Kingston Wharves, rum-cake brand Tortuga and Mavis Bank Coffee Factory.
Producers earned J$256 million pre-tax profit share from associated and joint ventures. It was the first full year of incorporating a series of new ventures into its financials. The diversification allowed the group to avoid posting a loss in a hurricane-affected year.
The largest profit share came from Kingston Wharves at J$178 million, followed by Mavis Bank at J$42 million and Tortuga at J$418,000.
"Tortuga and Mavis Bank performed in line with expectations, said JPG. In addition, we successfully concluded the start-up phase of our Four Rivers Mining subsidiary during the year and this construction aggregates business also contributed to the overall divisional profit," the company said.
The group generated J$6.8 billion in revenues, up 10 per cent over the prior year. The rise was however tempered by Hurricane Sandy which struck Jamaica in October 2012.
"The storm substantially destroyed our banana crop and forced us to temporarily shutter our tropical snack factory in St. Mary while we continued to carry much of the overheads associated with this facility," stated JPG in a joint statement accompanying its newly released financials.
Producers said that its overseas factories allowed it to maintain its market positioning and revenue base throughout the year, and that it relied on our tropical snack factory in the Dominican Republic for a limited volume of banana and plantain chips."
JPG expects its local banana farms to return to production at the end of the second quarter of 2013.The company also benefited from its emerging production of pineapples, cassava-based products and coconuts -- all of which are less susceptible than bananas to hurricane damage.
The group invested some J$2.16 billion in acquiring a 30 per cent stake in Kingston Wharves, which operates a bustling transhipment operations. The group's contribution to Mavis Bank joint venture totalled J$121 million in 2012 compared with J$56 million in 2011, and it paid cash consideration of J$421 million for a 62 per cent stake in Tortuga which operates production facilities in Barbados, Cayman and Jamaica. Tortuga also maintains a distribution outlet in South Florida and has a franchise operation in The Bahamas.
JP said it would harness the synergies that are "now available" arising from the market position of its brands but remains cautious about the sluggish economy.
"We remain extremely concerned about the macroeconomic environment in the Caribbean generally and in particular in Jamaica. Our strategy is to maintain a diverse product range that includes both value priced snack and fresh produce items for the 'on-shore' Caribbean consumer market as well as truly distinctive speciality foods which are able to derive growth and hard currency earnings from export markets and the tourism sector. We are satisfied that this places us in the best position to deal with the economic conditions," the company said.