GK inks remittance deals with Lynk, Courts, posts strong results
Rising sales of GraceKennedy products across Jamaica was tagged as one of the major contributors to double-digit growth posted by the conglomerate for the first quarter ending March, despite an economic climate that Group CEO Don Wehby says...
Rising sales of GraceKennedy products across Jamaica was tagged as one of the major contributors to double-digit growth posted by the conglomerate for the first quarter ending March, despite an economic climate that Group CEO Don Wehby says continues to be challenging for the businesses.
Wehby is expected to discuss strategies for GK’s banking and insurance divisions at the upcoming annual general meeting scheduled for May 31.
But as to its money services operations, through GK Money Services, the conglomerate disclosed that it has struck deals with Unicomer Jamaica Limited, the operator of the Courts furniture chain, to offer Western Union services at its retail stores, and with National Commercial Bank Jamaica Limited to offer Western Union services via their digital wallet – Lynk.
Both agreements remain subject to regulatory and other approvals, with implementation anticipated to begin later this year.
GK, which made the disclosures at the release of its quarterly financial report, achieved earnings of $2.2 billion, reflecting a near 21 per cent gain year on year, on group revenue that climbed nearly eight per cent to $39 billion.
“We have been successfully executing critical strategic initiatives to address the headwinds which our business has been facing,” Wehby said, while adding that the company continues to operate in a challenging economic climate characterised by inflation, higher interest rates, fluctuating foreign currency markets and increased costs.
Already, the conglomerate says it has seen some improvement in logistics and freight rates, a trend it expects to continue in the coming months, but that it has remained focused on improving efficiencies and service levels, cost controls, margin management, and customer engagement.
“Overall, this has enhanced our performance, and GK has started the year strong,” Wehby said.
The breakdown of the divisions showed that food trading achieved pre-tax profit growth of 50 per cent year on year to $2.3 billion. Revenue rose to $31.4 billion against $29.5 billion for the comparative period of 2022.
The money services division pre-tax earnings remained flat at $777 million when compared to the first quarter of 2022, while the divisions banking and investments along with GK insurance business segment posted declines on pre-tax profit year on year.
The banking and investments division took the heavier blow, sliding 64 per cent in year on year profit to $159.7 million, while the insurance segment was down nine per cent.
Alongside the new Western Union partnerships, for which GK is the exclusive agent, the company is talking with regulators to roll out its GK One digital wallet and app to regional countries. The app is still in its testing phase.