GraceKennedy Limited’s (GK) Investor Briefing held on November 13 2017
Mr. Don Wehby, GK’s Group Chief Executive Officer (CEO), provided an overview of the company’s strategic plans for the future and its nine month performance year to date. Mr. Wehby began the briefing by speaking on a few of the company’s revenue drivers and recent activities by the Group.
The proceedings commenced with Mr. Wehby addressing the revenue increase in the Food Trading Segment which included operations in Canada ,USA,Ghana and the UK. The CEO stated that the group saw a double digit increase in Grace foods Canada and is looking to expand to the western region of Canada. The company however saw a decline in its UK market and has focused efforts in recovering same with the introduction of Daniel Sturridge as new brand ambassador for the Nurishment food drink brand. Mr. Wehby also stated that, “ Grace Foods Latin America & Caribbean (GF LACA) continues to be affected by the slow recovery of corned beef sales following a ban on the sale and distribution of corned beef in several markets in March 2017. Additionally Hurricanes Irma and Maria disrupted operations on the islands of St. Maarten, British Virgin Island and Dominica. Distribution partners in those countries continue to work toward restoring normalcy to their operations.” He however noted that the decline in corn beef sales in Jamaica were offset by increased sales in Grace Mackerel and Viena Sausages brand.
Touching on the recent acquisition to the Group, Consumer Brands, Mr. Wehby highlighted that Consumer Brands has been doing extremely well as revenues and profit are “above expectations”. Additionally, the GK completed the renovation of its Hilo store located in Portmore, St. Catherine with a plan to include one of its Integrated Retail Banks. Mr. Wehby said this is expected to be “finished by the end of the year”.
According to the CEO, “First Global Bank (FGB) had an excellent year”, as growth was driven mainly by net interest income and higher gains on securities sold when compared to the same period in 2016. FGB’s new direction, includes branch expansion as highlighted above through the introduction of its integrated retail branches. The Bank also saw the introduction of a new Chairman in Peter Moses, who add a wealth experience and know how as he seeks to help grow and sustain First Global Bank.
The Money Services segment through GraceKennedy Money Services (GKMS) reported growth in both revenue and pre-tax profit over the corresponding period of 2016. This was due to increased transaction volumes in the remittance business, most notably in Trinidad and Tobago, Cayman and Guyana. The company however saw a decline in the Jamaican Sector due to the temporary shutdown of nine locations to facilitate a system review. This step was done to combat fraud as GK continues its fight against money laundering.
GK’s Insurance segment declined in both revenue and profit when compared to the corresponding period of 2016. This outcome was influenced by high premium rates in the Jamaican segment via broker allied insurance brokers . GK General Insurance company was also affected by the passing of the hurricanes which hit the eastern Caribbean. However Mr. wehby noted that the company’s reinsurance will lessen the impact received by the hurricane in relation to claims expense. Mr. Wehby then allowed Mr. Frank James, Group Chief Financial Officer (CFO), to provide an overview on the company’s performance for the nine months. The key highlights in the CFO’s presentation can be seen below.
- The Group achieved revenues of $69.3 billion, up by $2.6 billion over the same period in 2016.
- Third Quarter year over year growth of 56.89%.
- $1.13 year to date dividend payment.
- Increase in Total Assets due to acquisition of Consumer Brands renovation of Hilo Portmore and the building of the new headquarters located in Downtown Kingston.
- Shareholder Equity moved to $44.4 billion from $42.0 billion in 2016 showing the company’s strong equity position.
Mr. Wehby closed the investor briefing by stating, “we have been steadily executing our strategy and are seeing the results. We are pleased with the performance of the Group and expect to finish 2017 on a strong note. With our customers at the focus of our entire operation, innovation, convenience and new technology are shaping our view of the future and how we deliver our goods and services.”
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