JP Group positions for new opportunities, records $629m in profit
JP Group CEO, Jeffery Hall
Jamaica Producers (JP) Group’s performance for the first six months of 2019 was strong.
Year-to-date profits attributable to shareholders are up 52 per cent relative to 2018. Shareholders’ equity increased by $1.4 billion or 11 per cent since the start of the year.
Both of JP’s business segments – Logistics & Infrastructure and Food & Drink divisions generated significantly improved second quarter and year-to-date revenues and profits relative to 2018.
Amid the strong performance, JP Group CEO Jeffery Hall believes the next 18 months must account for volatile global exchange rates and major changes to the trade rules.
“Jamaican businesses and policy makers will need to rapidly adjust to an uncertain global economic environment. The business outlook for the next 18 months must account for volatile global exchange rates and major changes to the trade rules affecting China, Europe and the UK, the United States and other parts of North America.”
JP is positioning itself to identify growth opportunities in the new environment.
“In Jamaica, these will come from value-added services in logistics and manufacturing that take advantage of Jamaica’s access to global consumer markets,” said Hall.
“JP believes that if Jamaica maintains open borders for competitive production zones, continues to make it easy to do business and retains world-class transport links across the hemisphere it can gain rather than lose in the current environment” he further explained.
JP’s manufacturing centres for Tortuga and JP St. Mary’s branded products, as well as its investment in Kingston Wharves, are specifically organized to build on these opportunities in Jamaica. JP is also positioning its manufacturing and logistics businesses in other countries to seize opportunities in the current global environment.
During the second quarter, the JP Logistics & Infrastructure division, which includes Kingston Wharves Limited – JP’s largest subsidiary by assets, and UK-based freight forwarder, JP Shipping Services, accounted for a bulk of the group’s assets and profits.
During the review quarter, Kingston Wharves benefited from growing volumes of project cargo as well as bulk, breakbulk and automotive shipments to Jamaica and the region.
Meanwhile, the JP Food & Drink division made a significant contribution to JP’s overall revenue, which increased by 11 per cent during the quarter to $5.4 billion, up from $4.8 billion in the comparative quarter. The division earned year-to-date 2019 profits before finance cost and taxation of $438 million, a 48 per cent increase on the prior-year result of $296 million.
JP completed the sale of 30 per cent of JP Snacks Caribbean Limited, the holding company for the JP snack food operations (which includes the JP St Mary’s brand) to Wisynco Group during the quarter.
As a part of this deal, Wisynco was appointed the exclusive distributor for JP St Mary’s snacks in Jamaica.
“JP is optimistic about the long-term prospects of working with Wisynco to continue to grow the JP St Mary’s brand in Jamaica and internationally. We expect sales growth to arise from more streamlined distribution and, importantly, from ongoing new product development in tropical snacks.” Hall said.
Under International Financial Reporting Standards, the gain associated with the sale of shares in JP Snacks Caribbean Limited to Wisynco is directly credited to JP shareholders’ equity and is not reflected in the results shown in the group Statement of Profit or Loss.