Citing years of exceptional performance and aggressive export growth plans, Spur Tree Spices Jamaica Limited enticed potential investors at a briefing held on Wednesday (December 29), the day of the opening of the highly anticipated Initial Public Offering (IPO). 

The sauces and seasonings manufacturer is seeking to raise up to J$335,391,848, at a price of J$1.00 per share. The IPO is slated to close on January 19, 2022. 

At the briefing, CEO Albert Bailey positioned Spur Tree as a valuable prospect for investment, saying, “Our high-quality products satisfy a growing demand for authentic Jamaican flavours, and we want to raise funds to continue innovating and developing new markets. This is the right time to come on board and be part of what is an extremely bright future. We invite all Jamaicans to take the opportunity to invest in our rapidly expanding business.”

Spur Tree is a Jamaican company specialising in the production, distribution and sales of premium quality ready-to-use marinades and sauces, primarily for export. Its products are available in Jamaica, the United States, Canada, United Kingdom, Cayman Island, Costa Rica, and Australia through several distributor outlets. Over 90 per cent of revenue in 2020 was generated from export sales.

Early beginnings of Spur Tree Spices Jamaica

Harrinarine “Mohan” Jagnarine, executive director in charge of New Business and Market Development and one of the original company founders told investors about how the business started. 

“We started this company fifteen years ago to satisfy the growing demand for exotic Caribbean flavours in the export market and our growth has been phenomenal. We have consistently delivered impressive results and there is plenty more to come as we continue to open new markets. We invite you to be part of the journey,” he told the virtual audience.

In each of the last five years, Spur Tree increased revenue by over 20 per cent. Additionally, during the eight-month period ending August 31, 2021, the company delivered a significant improvement in performance thanks to a 28 per cent growth in sales to J$542 million over the prior corresponding period. The company’s gross profit also increased by J$45 million driven by climbing revenues and a jump in gross profit margin from 27 per cent to 30 per cent over the 8-month period. 

Meanwhile, fiscal prudence kept operating expenses in check at J$70 million in comparison to J$73 million in the prior period.  This paved the way for an increase in operating profit to J$96 million from J$50 million in the prior period.

Recent company performance highlighted

In lauding the company’s most recent performance, Douglas Robinson of GK Capital Management Limited, lead brokers for the IPO, said “Spur Tree has prevailed despite the adverse economic circumstances caused by the pandemic. Thanks to a continued strategic focus on expanding exports, and expert fiscal management to contain costs, the company is experiencing sustained growth and profitability.”

He said GK Capital is proud to be associated with bringing this IPO to market and we anticipate a strong take-up of the offer. Company chairman, Metry Seaga, highlighted recent investments as another prime reason for investors to snap up shares on offer.

“Our recent acquisition of Exotic Products Jamaica Limited augers well for our mutual growth and ability to meet the growing demand. The outlook for Spur Tree is very positive and we are excited at this opportunity to raise the necessary capital to take the company to the next level,” Seaga said.

Spur Tree plans to use the funds raised from the IPO to fund capacity building, innovation, and expansion along with liquidating existing debt. A portion of the proceeds will be used to fund the invitation and listing expenses associated with the IPO which is not expected to exceed J$25 minion.