Jamaica Broilers reporting strong quarter amid rebound
Poultry company Jamaica Broilers Group says its growth trajectory is back on track, with poultry volumes back to pre-pandemic levels.
Elaborating on the “recovery” referenced in the group’s third quarter financial report, President & CEO Christopher Levy said the company was on a particular growth path that was flattened by the health crisis, but has since recovered.
“When you look at our poultry, feeds and other segments, whilst it held strong during the pandemic, the trajectory that we were on went flat,” said Levy.
“Usually we see good, consistent growth in volumes every year,” he added, explaining that the real reference point for his company was not what was happening during the pandemic but rather what had previously been projected.
“We were planning two-to-three or four years out, but COVID-19 hit, and all we were trying to do then was maintain volumes,” he said, while noting that the pandemic represented lost opportunities.
During the pandemic-induced lockdowns and curfews Jamaica Broilers adjusted its distribution strategy to incorporate more direct-to-customer sales, with its refrigerated trucks plying the company’s wares at convenient spots in population centres.
Levy said the company used the experience to take a hard look at its operations, to enhance efficiency at various levels.
“These are the sort of results that were expected when we went into the restructuring during and after COVID. There was a need to refocus and get very disciplined on expenditure,” Levy said.
Part of the restructuring exercise included the October 2022 pull-out from Haiti, where Haiti Broilers SA and its subsidiary T&S Rice SA, which dealt in the production and sale of chickens, layer pullets, table eggs and animal feeds, were shuttered after years of being a “profit drag” on its Jamaican parent and ongoing political turmoil in the country.
It ended a 12-year run in that market, which Levy still maintains was a tough decision but one that came as a relief to the company after the decision was made.
“There was some closure. It was a very tough decision and a difficult process but I think everyone looking on understood the wisdom of the decision,” Levy said.
Jamaica Broilers Group took a $900 million hit on the investment in Haiti Broilers. Levy said the company would have faced monthly losses of $30 million to $40 million had the operations continued.
With the closure of Haiti and other company reorganisation, Jamaica Broilers Group reported profit of $1.5 billion for the quarter ended January 2023, up 27 per cent year on year. Quarterly revenue grew by 20 per cent to $22.7 billion.
Levy is bullish on prospects for the business this year amid ongoing recovery of the tourism market and other positive economic signs.
“We’re very encouraged by the economy in Jamaica, activities in the tourism sector, including additional rooms, and employment ranging from hotel workers to BPO and other sectors,” Levy said.
Within the poultry sector, Levy said he has also seen marked improvement in efficiency and business acumen among small chicken farmers who contribute between 30-35 per cent of the volumes sold by Jamaica Broilers.
He is projecting that the small farmer segment will improve supplies by about three per cent, while noting that their improved output had directly impact the sale of baby chicks in addition to overall poultry and eggs production.