AMG Packaging records back to back profit growth
Corrugated box manufacturer AMG Packaging & Paper Company Limited continues to show improvement in its bottom-line performance, two years after the coronavirus pandemic threw its earnings off track.
In its yearly results for the period ending August 2022, the box-maker reported preliminary earnings of $107.5 million, reflecting a gain of 77 per cent over the $60.5 million recorded in the previous year. Revenue swelled 41 per cent to $995 million. The numbers are still subject to audit.
It marks the second consecutive year of growth for the box-maker, which in FY2020, saw profits dip eight per cent.
“For the financial year 2022, AMG continues to show a recovery pattern over recent years. The company hopes to continue on this road to recovery,” Managing Director George Hugh said in the preamble to the financial statements.
AMG Packaging, among other cardboard manufacturing and distribution companies, had for months complained of the shortage of paper on the world market, as well as the increases in freight costs which drove up production costs.
To offset some of the fallout in business, AMG Packaging increased product prices, beefed up production on specific items and was in constant dialogue with clients on product delays.
Hugh said the company continues to keep watch on trends in the international and local markets, but did not specify whether the company has, or will be looking to bring prices back down, as business with its international suppliers and freight costs normalizes.
In the meantime, the company has been pressing ahead with the construction of a second factory at its Retirement Road complex in Kingston.
“I’m pleased to report that during the period we acquired JPS service to our location,” Hugh said, in an update referring to the supply of electricity by power utility Jamaica Public Service Company Limited.
The company plans to double production capacity with the addition of the new plant and is looking to increase its share of the market from 30 per cent to 50 per cent through the supply of products made from recycled paper.
AMG, which has manufactured boxes for more than 15 years using virgin paper as input, is trying to enter a segment of the market currently served by imports. Currently, boxes made with recycled material are largely shipped from Dominican Republic and Costa Rica.
The new plant was financed from a $100-million bond.