Jamaica Broilers’ local operations are feeling the negative effects of increased grain prices and rising international shipping costs, resulting in profits going down by six per cent during the nine-month period ended January 29, 2022.

The star segment performer during the period was Jamaica Broilers’ American operations with a 111 per cent increase in segment profit versus the prior year. This was made possible by the expansion into producing and supplying The Best Dressed Chicken in the US market.

The nine-month performance of the group was commendable, despite the Jamaica operations reporting a six per cent decline in segment profit. This decrease was attributed to increased production costs, all of which were not passed on to customers.

Increase in net profits

Net profit for the nine months amounted to J$2 billion, a nine per cent increase over the corresponding nine-month period in the prior year. The American operation was the major driver in this performance.

Group revenues for the nine months amounted to J$55.1 billion, a 33 per cent increase above the J$41.3 billion achieved in the corresponding nine months of the previous year. Gross profit for the nine months was J$11.8 billion, a 15 per cent increase over the previous year.

However, gross profit as a percentage of sales (gross margin) declined from 25 per cent to 21 per cent when compared with the prior year. The decline in gross margin is primarily attributable to increased input costs, which was partially mitigated by the significant growth in the American business.

Segment performance

The Jamaica operations reported a segment result of $2.9 billion, which was J$176 million or six per cent below last year’s segment result of J$3.1 billion. Total revenue for the  Jamaican operations showed an increase of 29 per cent.

The American operation reported a segment result of J$2.4 billion, which was a 111 per cent increase over the prior year’s result of J$1.3 billion. This increase was primarily driven by higher production and sales in The Best Dressed Chicken line of products and the operation’s participation in the employee benefits programme, which was offered to alleviate the impact of COVID-19.

This amounted to J$584 million which is reported as other income, during the quarter. Total revenue showed an increase of 48 per cent.

The Haitian operation reported a segment loss of J$10.6 million compared to the prior-year loss of J$23.3 million, an improvement of J$12.7 million. Total revenue reduced by 36 per cent, as Haiti continues to experience economic and political instability, which continues to impact its operations in that country.