Sunday 29 November, 2020

Kremi enters shared-service arrangement with Scoops Unlimited

Chairman of Caribbean Cream Limited (Kremi), Carol Clarke Webster says the company’s pricing model and distribution system have been able to withstand the challenging conditions experienced in the second quarter of 2020.

Kremi has also entered into a shared service agreement with a related company, Scoops Unlimited Limited, which will result in cost savings, management said in the annual report released on June 29.

Under the agreement, finance, marketing, human resources and information technology professional services are shared by both companies and are centralised at one location.

The move is expected to reduce administrative costs and increase productivity.

In the annual report, management outlined that notwithstanding the general downturn in local and world economic activity due to the pandemic, Kremi is optimistic about sustaining sales as demand for its product has exhibited “buoyancy.”

Kremi’s chairman, Clarke Webster also said the company’s cash reserves have stood as a buffer during the period.
“Caribbean Cream Limited has always been careful to put aside a large cash reserve for a company of this size and this financial year is no different,” Clarke Webster said.

“At the end of the current financial year, we had a little over $129 million in cash.”

She outlined that the company’s “innovative business model, where we distribute our products directly to customers in communities through our wholesalers, bike and household vendors, continues to strengthen our revenue stream as it has for the past decade.”

Fourteen years ago the company installed an ice cream mix plant at Derrymore Road. It has grown revenues exponentially since.

Kremi ended the year with a 10 per cent increase in revenue to total $1.71 billion compared to $1.55 billion in 2019.

Revenue for the fourth quarter rose 16 per cent to close at $470.92 million compared to $405.17 million for the comparable quarter of 2019.

The company, directors said in the report, has worked on developing high quality, but less expensive, ice-cream other than the premium Devon House brand.

Scoops Unlimited Limited, producers of Devon House ice cream, set up Caribbean Cream Limited to service that new market.

Currently, Kremi distributes most of its products, through wholesale, modern trade and retail outlets, as well as by mobile vendors, known locally as ‘fudgies’.

For 2019/2020 sales went up by $153 million or 10 per cent, mainly due to increased product offerings, made possible by the installation of a new line for stick-based, frozen novelties, created in-house, under the Kremi brand during the previous year.

The company also opened a new depot in May Pen.

Net Profit for the year ended February 2020, before taxation moved downwards from $103 million last year to $62 million this year.

This was due, management said, to a hike in commodity costs, driven primarily by increased prices worldwide and worsened by the fluctuating exchange rate against the US dollar. 

Costs were not passed on to consumers.

The chairman said that steps were being taken “to improve that position going forward.”

Clarke Webster said the company’s pricing model and distribution system have been able to withstand the challenging conditions experienced in the second quarter of 2020.

Kremi has also entered into a shared service agreement with a related company, Scoops Unlimited Limited, which will result in cost savings, management said in the annual report released on June 29.

Under the agreement, finance, marketing, human resources and information technology professional services are shared by both companies and are centralised at one location.

The move is expected to reduce administrative costs and increase productivity.

In the annual report, management outlined that notwithstanding the general downturn in local and world economic activity due to the pandemic, Kremi is optimistic about sustaining sales as demand for its product has exhibited “buoyancy.”

Kremi’s chairman, Clarke Webster also said the company’s cash reserves have stood as a buffer during the period.

“Caribbean Cream Limited has always been careful to put aside a large cash reserve for a company of this size and this financial year is no different,” Clarke Webster said.

“At the end of the current financial year, we had a little over $129 million in cash.”

She outlined that the company’s “innovative business model, where we distribute our products directly to customers in communities through our wholesalers, bike and household vendors, continues to strengthen our revenue stream as it has for the past decade.”

Fourteen years ago the company installed an ice cream mix plant at Derrymore Road. It has grown revenues exponentially since.

Kremi ended the year with a 10 per cent increase in revenue to total $1.71 billion compared to $1.55 billion in 2019.

Revenue for the fourth quarter rose 16 per cent to close at $470.92 million compared to $405.17 million for the comparable quarter of 2019.

The company, directors said in the report, has worked on developing high quality, but less expensive, ice-cream other than the premium Devon House brand.

Scoops Unlimited Limited, producers of Devon House ice cream, set up Caribbean Cream Limited to service that new market.

Currently, Kremi distributes most of its products, through wholesale, modern trade and retail outlets, as well as by mobile vendors, known locally as ‘fudgies’.

For 2019/2020 sales went up by $153 million or 10 per cent, mainly due to increased product offerings, made possible by the installation of a new line for stick-based, frozen novelties, created in-house, under the Kremi brand during the previous year.

The company also opened a new depot in May Pen.

Net Profit for the year ended February 2020, before taxation moved downwards from $103 million last year to $62 million this year.

This was due, management said, to a hike in commodity costs, driven primarily by increased prices worldwide and worsened by the fluctuating exchange rate against the US dollar. 

Costs were not passed on to consumers.

The chairman said that steps were being taken “to improve that position going forward.”
 

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