Distribution company, Derrimon Trading Limited recorded improved business performance for the half year in spite of the many challenges.

For the six months ended June 30, 2021, Derrimon reported trading income of $8.05 billion compared to the $6.30 billion booked for the prior year’s comparable period.

The improved performance is attributable to the aggressive implementation of revenue growth strategies employed by all companies and business segments within the Group; namely manufacturing, distribution and retail.

According to a management report,“despite the negative impact of the Covid-19 measures, logistical challenges, raw materials shortages and delays from our overseas suppliers and partners, total revenues increased, resulting in year over year improvements.”

Cost of sales increased by 28% to $6.51 billion for the period (2020: $5.10 billion).

“The results for the first six months of 2021 are very encouraging for our business and marks a notable time in our history. Despite the spike in shipping costs, supply chain disruptions and various logistical hurdles, we achieved significant increases in sales and profits,” Derrimon’s management said in a report.

“The continuing depreciation of the Jamaican Dollar is of concern, hence the launch of Marnock LLC (one of Derrimon’s subsidiary) is not only timely but also important in our exchange risk mitigation strategy. Notwithstanding the challenges, we remain committed to growing the businesses for the benefit of our shareholders and delivering a high-quality service to our customers,” the management added.

Gross profits went up 28%

Gross profit for the period under review amounted to $1.54 billion relative to $1.20 billion for the prior comparable period, an increase of 28% year over year. Gross profit for the June quarter rose 34% year over year to $787.14 million.

Profit before taxation grew to $321.42 million compared to $207.47 million in 2020. After incurring tax charges of $35.61 million, net profit amounted to $285.81 million, a 55% growth when compared to $183.89 million reported for the first six months of 2020.

Net profit attributable to shareholders amounted to $271.39 million compared to $160.66 million recorded in 2020. Net profit attributable to shareholders for the quarter closed at $116 million relative to $69.04 million for the second quarter of 2020.

For the quarter, finance cost closed at $46.41 million versus $67.79 million in the 2020, a 32% decline year over year.

Operating expenses went up 28%

Total operating expenses totaled $1.21 billion for the period under review, representing a growth of 26% on the $965.76 million recorded in the prior year’s corresponding period. Of this, administrative expenses amounted to $995.26 million, 28% higher when compared to the $776.84 million in 2020.

Selling and distribution expenses recorded a 15% increase for the period, totaling $218.04 million (2020: $188.93 million). Total expenses for the quarter posted a 30% increase from $492.38 million in 2020 to $638.53 million for the three months ended June 30, 2021.

As at June 30, 2021, Derrimon’s assets totaled $10.16 billion (2020: $5.77 billion), 76% more than its value as at June 30, 2020. This was due to largely to increases in ‘Inventories’ and ‘Investment in Subsidiary’ which closed at $2.97 billion (2020: $1.48 billion) and $1.37 billion (2020: nil), respectively.