Durrant Pate/Contributor

Jamaican-based conglomerate, Seprod Group has seen its revenues inch up but profits contracted at its half-year period, exemplifying the challenging business environment.  

For the six months ended June 2024, Seprod achieved revenues of $58.33 billion, an increase of $3.88 billion (7%) over the corresponding period in 2023. Gross profit closed at $14.93 billion, up $1.11 billion (8%) over 2023. 

However, net profit amounted to $2.15 billion, representing a contraction of $396 million or 16% lower than 2023. For the second quarter ended June 30, Seprod Group attained revenues of $29.74 billion, up $2.35 billion (9%) over 2023. 

Gross profit closed at $7.43 billion, an increase of $529 million (8%) above 2023 but net profit is down to $941 million, a decline of $245 million (21%).

Clawing back lost ground

Seprod in its just-released second quarter and half-year report, says it is now regaining lost margarine market in the domestic and export markets, which during 2023 when it embarked on a massive plant upgrade. At the same time, the juice and dairy beverage demand continues to show robust growth. 

Based on the organic growth trajectory plus the innovation pipeline, Seprod triggered a $700 million investment to increase capacity enhancement in the processing and packaging areas. 

These investments, it says, are happening in a staggered phase but the overall project will go live by the first quarter of 2025. Export sales grew by 27% meeting expectations. 

AS Brydan was a drag

The Jamaican conglomerate is reporting that the major contributor to its profitability shortfall was the performance of its Trinidad subsidiary, AS Bryden, which while chalking up increased revenues, saw its profitability contracted for the period under review. Revenues there increased by 11% over the comparative period but its net profit declined by 44%, primarily due to expiration of one-off benefits, which the company had in 2023 and to higher than planned finance costs to acquire foreign exchange. 

Seprod anticipates a stronger second-half-of-the-year performance from the Bryden Group. Seprod made significant up-front investments in people and infrastructure in the first half of the year to secure new business partnerships and to expand its regional footprint. 

This upfront cost will start to generate revenue in the last quarter of this year, as export growth will continue to be robust with the Richard Pandohie-led management being particularly excited about Guyana’s growth realisation. The management reports that innovation pipeline and brand investment will continue with a couple of exciting launches in the second half of the year. 

The management says it remains optimistic that the company will achieve its 2024 goals.