Jeffrey Hall Chairman For Blue Power Group Has Released The Following Report For The Six-Month Period Ended October 31, 2023
Blue Power Group delivered strong results for the six-month period ended October 31, 2023 (the “First Half”). Shareholder profits were up 330% relative to the comparable period in the prior year. The improved profits reflect the combined effect of (a) a range of initiatives to improve plant productivity and labour productivity, (b) improved procurement conditions and logistics costs, and (c) a change in the sales mix, to focus our production capacity on higher margin products.
We are particularly pleased to be able to report that the range of bar soaps manufactured here in Jamaica by Blue Power Group are consistently among the most price competitive in the market.
For the First Half, Blue Power Group achieved revenues of $402 million and shareholder profits of $71 million. Blue Power benefitted from its initiative to develop and maintain strategic long-term customer relationships with some of the leading soap brands and distribution enterprises in Jamaica.
Blue Power Group has made investments in plant and equipment to improve its competitiveness and to support these relationships with enhanced reliability and increased capacity to produce a wide range of high quality and specialty soaps. This resulted in improved gross margins. Importantly, the Group also successfully contained the cost of administration and delivered improved results from credit control and net finance income.
Outlook
With the improved operating performance, Blue Power Group now has a healthy business supplying the Jamaican market for laundry soap and a wide range of bath soaps including value-products, medicated soaps, anti-bacterial soaps, beauty soaps and natural soaps that include local ingredients and locally made formulations that support healthy skin. We are now the leading manufacturer of soaps in the Jamaican market.
An important part of our plan for sustained business growth is our ongoing commitment to efficiency and innovation. During the quarter we continued to complete capital projects and make improvements to our quality systems, efficiency, facilities, and product lines. We note that some market opportunities within CARICOM may be constrained by current legal uncertainties about the trade rules within the region.
We do, however, remain hopeful that Blue Power Group will be able to grow in the years ahead by manufacturing and co-packing bar soaps for both domestic and export markets. We believe that our export prospects are directly in line with Jamaica’s stated policy goal of developing a logistics-centered economy with value-added manufacturing that competitively serves the global marketplace.
We will continue to build the business on the basis that this policy framework will ultimately prevail.
The Blue Power Group balance sheet, investment portfolio, and liquidity also remain strong. The value of our cash and investments totaled approximately $435 million at the end of the First Half. We also hold land that is adjacent to our core operations and is intended to allow for the expansion of our plant over time, as well as for the development of commercial buildings that can contribute in due course to our rental and investment income.
Our associated company investment in Lumber Depot Limited, which is a material part of our holdings, performed satisfactorily during the period.
We continue to be optimistic about the competitive position and growth prospects for our business in Jamaica, as well as the opportunity to develop new markets. We are also prepared to diversify the business through opportunistic investments in related industries.
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