May 26, 2021
GraceKennedy Limited (GK) recorded the highest revenue in it’s history of $115.44 billion for the year ended December 31, 2020 (2019: $103.09 billion), a year-over-year increase of 12%. There was no one-off gain which led to an increase in net profit by 34% to $6.86 billion from $5.10 billion booked for the corresponding period of 2019. For the first quarter ended March 31, 2021, GraceKennedy Limited (GK) recorded revenues of $31.39 billion (2020: $28.85 billion), a year over year increase of 9% which translated to a 27% increase in net profit to $1.84 billion from $1.45 billion booked for the corresponding period of 2020.
Global Consumer Group
The target for revenue earned outside of Jamaica is 60% by 2025, as at 2020, this is currently at 46.6%. The Group profit derived from outside of Jamaica target is 50% and is currently at 45% as at 2020. GK plans to leverage its relationships with multinationals and form partnerships to enhance its offerings. Currently, there are 5 partners such as Western Union, Fritolay and Nestle to name a few. GK entered into a joint partnership with Nestle to distribute some of their products.
GK Response to COVID-19
GK’s Actions
- Activated the Business Continuity Plan on January 29, 2020
- Established a Global multi-discipline Steering Committee on March 3, 2020
- Weekly Executive Committee meetings.
- Ensuring the safety and well-being of staff with > 60% of our office working from home, and the implementation of other staff support initiatives
- Ensuring our Supply Chain remains robust and consistent
- Managing our liquidity, cost containment and cost reduction
- Identifying opportunities in the crisis
- Giving back to communities
Strategic Drivers
Group CEO highlighted the Company’s Vision and Mission going forward, with emphasis on four Strategic Pillars:
- Sustainable Growth & Innovation
- Consumer Centricity
- Internal Processes
- Performance Driven Organization
Focus Areas for 2021 and Beyond, Mr. Don Wehby noted:
- Digital Transformation: Execute digital initiatives and launching a Digital Factory
- Mergers & Acquisitions: Pursue transactions locally & internationally.
- Invest in our Brands: Continue to introduce new products and services
- Working Capital Management: Manage operational liquidity and cash preservation
- Corporate Social Responsibility: Focus on the community
- Operational Efficiency: Process improvement, cost containment and improved use of technology
- Margin Management: Pursue effective pricing strategies to improve margins
- Compliance & Risk Management: Continued focus to reduce threats protect customers
- Strong Talent Management: Attract, retain and develop talent at all levels
- Market Share: Grow Market Share in all business segments
Regarding Mergers & Acquisitions, GK’s acquisition of Scotia Insurance Eastern Caribbean Limited, Creditor Life Insurance is expected to be completed by July 31, 2021. Additionally, GK acquired the 876 Blue Mountain Spring Water Brand since year.
GK noted that, “GK foods (USA) LLC is a major pillar for our Global Expansion Strategy.” LLC showed tremendous growth in 2020. Grace Brand grew 78% since 2015. Improved profitability of the La Fe brand now poised for growth. Revenue of US$36M since acquisition.
Digital Transformation
In 2020, GK developed a Digital Strategy with a multi-year roadmap of digital products. The program is designed around 3 key pillars: Customer experience, operational efficiency and digital innovation. The Digital Factory was launched in February 2021. GK is focused on delivering unique and easy to use solutions while driving cross-selling and upselling opportunities. In fact, Mr. Wehby noted that, “3 digital products will be launched in the third quarter of 2021.”
Regarding Consumer Centricity and Innovation-Digital, GK plans to engage its customers, providing innovative solutions inspired by business intelligence. Its digital integration includes 3 phases:
- Phase 1: Prepaid Card
- Phase 2: Mobile Wallet
- Phase 3: Mobile App
So far, GK has done the following digital improvements:
- Global Access 2.0
- Instacart- GK’s products grew by 400% in 2020
- Digital Registration-Western Union (send to bank)
- Insurance- Increased online offerings
- Hi-Lo E-commerce (coming soon)
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