Derrimon tackling debt as priority amid operational restructuring
Published:Wednesday | September 24, 2025 | 12:06 AM
Derrimon Trading Company Limited is taking steps to deleverage, an issue that has become a priority for the group amid concerns by its auditors.
CEO Ian Kelly disclosed that discussions were under way with some creditors to refinance portions of the company’s debt.
BakerTilly, which is the trading company’s external auditor, said in its report that it had “robust discussions with senior management regarding the growth and expansion strategy using debt as the principal means of growth and expansion” and relying on cash flows to reduce debt over the long term.
“A downside to this strategy is the inherent liquidity risk that the cash-generating units acquired may not perform as expected, resulting in the company and group being unable to meet its obligations as they fall due,” the audit report noted.
Derrimon Trading has a debt of $4.2 billion, which was 65.22 times its equity of $6.5 million, at year ending December 2024.
Kelly said at the company’s annual general meeting last week that Derrimon successfully negotiated waivers with all its financial partners, including the Inter-American Development Bank, IDB, for the 2025 financial year. The arrangements with IDB were finalised in August, signalling confidence in the company’s turnaround strategy, he asserted to shareholders. The company has a US$13-million financing arrangement with IDB Invest.
The company’s efforts to lighten its debt load comes amid mixed performance in the June quarter. While revenue dipped slightly year-over-year from $4.25 billion to $4.21 billion, net profit surged 70 per cent to $106.4 million, up from $62.6 million.
Six-month revenue rose nine per cent to $8.5 billion, and profit climbed 35 per cent to $163 million, indicating that operational efficiencies are beginning to bear fruit, Kelly told the Financial Gleaner after the meeting.
Kelly attributed the gains to improved logistics and supply chain management, noting that 95 per cent of previous issues have been resolved. The company has also restructured its procurement and category management departments and partnered with a third-party logistics provider to enhance warehouse operations. These changes have enabled same-day delivery in many cases, a significant improvement in service levels, Kelly said.
However, he noted that the company isn’t out of the woods yet.
“We know what we need to do,” Kelly told shareholders. “We have the management team, the motivation, and the plan to build on the results of 2023, rather than 2024,” Kelly committed to shareholders.
A major component of Derrimon’s strategy involves its New York operations, which were severely impacted by flood damage in 2024. The company has since rebranded its two supermarkets – FoodSaver NY and Good Food for Less – as Sampars New York. Both stores reopened in August 2025 and are currently operating at 40 per cent to 50 per cent of pre-closure traffic and sales volumes.
To regain market share, Derrimon is targeting the Caribbean and African diaspora communities in Brooklyn. Staff are actively reaching out to wholesale clients and retail customers to rebuild foot traffic. The company estimates that the flood-related disruptions resulted in revenue losses of up to US$40 million, or approximately J$6.4 billion.
Derrimon Chairman Derrick Cotterell said the company has engaged an unnamed firm to negotiate a settlement with insurers.
Derrimon’s US$13-million facility with IDB Invest includes US$3 million for capital projects to modernise its distribution centre and install solar energy, and a US$5-million revolving credit line to support imports.
The other US$5 million was earmarked for investments, inclusive of a new drinking water production plant that is up and running. The water products are being marketed under the Refresh brand.
At the annual meeting, Kelly appealed for patience from shareholders.
“We operate in an extremely tough and competitive economy with tight margins,” he said. “But we are working tirelessly to re-energise and refocus the company,” he told shareholders.
Kelly became CEO of Derrimon at the top of this year, replacing founder Derrick Cotterell in that role. Prior to Kelly’s promotion, he was the company’s chief financial officer.