Connect with us

Businessuite Markets

BARGAINS ON HARBOUR STREET Companies going cheap

Published

15 years ago

on

“Those people who step up to the plate with confidence will come out of this crisis very well,”

Michael Lee Chin, Chairman NCB Group.

 

Hit hard by declining earnings, rapid depreciation of the Jamaican dollar, higher than projected interest rates and resulting tightened liquidity, 2008 proved to be the worst in the past six years for the many of the stocks listed on the Jamaica Stock Exchange. Overtaken by developments in the international and local markets, the three JSE indices failed to hold the position held in the early part of the year. Many of the Exchange’s blue chips traded at their lowest levels in 52 weeks as investors sold out and moved away from stocks to money market investments.

The report filed on the Jamaica Stock Exchange website for the end of December indicated that the year’s trading session reflected the following movement of the JSE Indices: –

* The JSE Market Index declined by 27,816.03 points (34.70%) to close at 80,152.03.

* The JSE Select Index declined by 944.23 points (47.57%) to close at 1,984.74.

* The JSE All Jamaican Composite declined by 32,787.93 points (44.31%) to close at 73,994.93.

Overall Market activity resulted from trading in 55 stocks of which 16 advanced, 35 declined and

4 traded firm. Market volume amounted to 2,295,666,264 units valued at over $24,066,168,185.51.

And the trend continues, with more companies trading even lower than the December 2009 closing figures. According to Steven Jackson writing recently in the Caribbean Business Report “The last time the market declined this much was in May 1996 at 12,936 points down 29 per cent year on year. But it is still better than in 1993 when the market lost 65 per cent of its value. It dipped from 32,421 points in January to 11,221 points by January 1994, losing over 90 per cent of its market capitalisation from J$1.45 billion to J$129.8 million according to Bank of Jamaica data.”

According to a leading brokerage firm in a published outlook on the economy for 2009, many of the quoted equity prices appear attractively priced relative to historical values. They also suggest that equity prices may well fall further before a rebound is seen, suggesting that even better bargains are on the horizon.

An interesting point raised by one analyst contact for this article was that “You don’t have to sell a lot of stock to impact price one way or the other.” Suggesting that small stock trades can and have impacted a company’s stock price, which is a concern for many and also implying an opportunity for manipulation. So the big question to be addressed by the Jamaica Stock Exchange is, should small trades be allowed to impact market prices. Businessuite understands that this concern has been raised by some companies. Donette Johnson, Senior Equities Trader at Jamaica Money Market Brokers, in responding to this point indicated that, “As a matter of fact, the JSE has attempted to address the perception of ‘manipulation’ on the market by introducing the average price being used as the closing price for the day. So no longer can brokers use 100 units at 11:59 to close stock prices at higher levels when indeed the market is trading at lower prices (this would give a misconception to investors and cause widespread disharmony among the investing public and even in some instances deter persons from even considering entering the market due to this perception and continued practice by brokers).”

But 2008 was a year when many of the companies listed on the Exchange saw the listed value of their stocks make drastic declines. Volumes traded was also on the high side, where in December for example Cable and Wireless Jamaica Ltd. was the volume leader with 503,461,572.00 units (21.93%) followed by Supreme Ventures Limited with 403,006,606 units (17.56%) and Jamaica Broilers Ltd. with 226,205,373 units (9.85%).

BOJ Impacts Market

According to financial analyst Fayval Williams, one of the contributing factors to the movement away from the stock market was the reversal in the local interest rate trend. Bank of Jamaica began raising interest rates in January, 2008.  Interest rates were adjusted upwards by 1% across all tenors of BOJ instruments and have been rising since then making money market instruments more attractive versus stocks. Donette Johnson Senior Equities Trader Jamaica Money Market Brokers Limited, however saw it differently. “I beg to differ on this point, as interest rates started trending up as soon as the credit crunch hit in September ’08 and financial houses were converting left, right and center in order to meet margin calls being made by overseas brokers. As a result of this pressure to convert to US$ this put added pressure on the J$. So the BOJ responded to stabilise that currency market by increasing local interest rates.”

Another factor argued by Fayval Williams was the weakening economy going forward as investors realized that the US recessions would spill over into Jamaica via remittance, tourism and bauxite sectors. This spelt a more uncertain economic environment and weaker profits for companies, not a good backdrop for stocks.

Other investors have also argued supporting Williams’s view that the high interest rate, initiated by the BOJ impacted the stock market last year as a result investors not able to realise the comparable 25% return on stock investments shifted by selling stocks and putting the money in high BOJ induced interest rates. It was even argued by some that the actions by investors looking forward were pre-emptive as they opted to move funds now rather than wait in an uncertain environment.

With the prevailing tight liquidity conditions on the international markets, the Government of Jamaica has increasingly turned to the local market to meet funding requirements.  This creates added impetus for further increases in interest rates locally and movement away from stocks. (Note: interest rates started to trend downwards sometime in March).

Marlene Street-Forrest General Manager of the Jamaica Stock Exchange was recently quoted as saying “Hardly any analyst would be able to say to you specifically when you are going to see a recovery. We are hoping it will rebound by next year but I have not applied any scientific basis.” (Did you ask Mrs. Street-Forrest for a guesstimate on the performance of the indices this calendar year end 2009?).

Street-Forrest blamed the ongoing decline in market performance on the global meltdown, high interest rates and its crippling spill over effect on company earnings in 2008.

“We have seen share prices at one of the lowest in recent times. This can be accounted for by the general bear market that we have seen that has continued over the last two years and has been coupled by the global financial crisis. Also, some of the companies financial returns posted lower than projected,” she said adding that now is the time to buy stocks.

The economic environment will affect the speed of recovery she stated, adding that the 2009/10 budgetary measures are being analysed to determine its effect on business.

The role of interest rates

“Interest rate reduction will play a factor in the demand for stocks. Next we are looking at the situation in the global arena and the recovery in overseas equity markets. Markets are based on confidence and the extent that investors feel there is more risk in the equities market then they will tend to shy away from it,” she argued.

As one high profile trader indicated “Stocks go up when companies are reporting rising profits but companies were reporting negative company profits going forward as people were buying and consuming less so this was also a contributing factor in my shifting funds away from stocks last year.”

Consumer Confidence Falls

The recently published Jamaica Chamber of Commerce (JCC) consumer confidence report said consumers judged the current state of the economy more negatively than the third quarter of 2008, these downbeat assessments did not cause pessimism about future economic prospects, It was reported that one third of all consumers at the close of 2008 felt that the economy had worsened, up from one in four at the start of the year. At the same time the proportion of consumers that anticipated better conditions remained largely unchanged, the report added.

However, Professor Richard Curtin, head of survey research unit at the University of Michigan, sees the optimism as somewhat surprising given the global economic slowdown and Jamaica’s dependence on tourism and remittances. “Consumers do not expect the kind of slowdown in the economy that I think is going to happen,”

Companies respond

As early as mid 2008 it was quietly reported that companies had already started to respond to the reduction in their income and profitability by laying off staff, seeking increased efficiencies in operation and purchases coupled with the overall use of assets. Going forward into 2009 and early 2010 financial institutions will see a further slowing down of their earnings as loan portfolios are not expected to grow at previous pace due to all the aforementioned factors. Manufacturing companies it is argued should benefit from moderation in prices, but will be adversely affected as consumers cut back on consumption due to lower disposable incomes.

Pessimistic Outlook Hides Value

“Wealth is created by owning businesses”.

Michael Lee Chin, NCB Group Chairman in a recently published article in the Caribbean Business Report recalls that about 10 years ago many Jamaican assets were snapped up by our Caribbean ‘brethren’ but with stock prices down all over the world he believes Jamaican companies now have an opportunity to buy back those companies and continue to make them profitable.

“If you are a foreign investor who bought a Jamaican asset 10 years ago, even though the asset as measured in Jamaican dollars has done well, by foreign currencies and hard assets that’s a different matter.

If you look at stock prices of the likes of Caribbean Cement, NCB, Grace, Guardian, they are now low. The question though is: who has money to acquire these assets? Who is liquid? Well, our pension funds are liquid. Our pension funds have gotten into the habit of investing in repos and government paper. Now that is not investing.

The pension managers are not optimising the wealth creation portion of their portfolios. Over the long haul, equities have always proven to be the best asset class, so now is a great time to be buying them because they are historically cheap.”

Where are they?

But where exactly are the bargain buys? Michelle Hirst, Research Manager at Stocks & Securities Ltd (SSL) thinks the following stocks are at bargain BUYS, plus just as important, strong business models, strong barriers to entry, strong management and above average long-term growth rates with a proven track record:

o   Pan-Jamaican Investment Trust

o   GraceKennedy

o   Salada Foods Jamaica Ltd

o   Jamaica Producers

o   Jamaica Broilers Group

o   Scotia Group Jamaica

o   Desnoes & Geddes

However, she continues “ we do think that local equity prices still have an inherent short-term (one year or less) downside risk of 20-30% from current price levels, dependent on how worse the credit crisis gets, recession, etc, where the DOW heads to, which we anticipate to be 6,600 points or less.

Therefore, although SSL does not advise clients to try and time the market, we recommend to cautiously BUY the above levels/positions and if we see for example Pan-Jam trade down to 18-20, we would recommend more aggressive purchasing here.

Also note another negative that always affects our market in the short-term is high interest rates as investors’ put funds to work in fixed income v. local equities. For the long-term YES the above equities show strong value at current prices meaning an investor to hold for 3 years or longer from “t”.”

According to one leading brokerage firm, unless there are clear signs of recovery in corporate profits, stability in the foreign exchange markets and lower interest rates, causing stock prices to move back up, investors will not go back to the equities market. They also suggest that if the local dollar continues to depreciate at its current pace, the possibility still exist that interest rates could go higher.

So with corporate profits expected to weaken in 2009 as further softening in consumer spending take place the projection is for flat market conditions in 2009.

For many this downward movement in stock prices was a direct response to the local and global economic crisis, the upward shift in interest rates and the continued fallout from the failed alternative investment schemes. But for the calculated few with cash, this is an opportunity to make a move on some bargain buys on Harbour Street. The expectation is that the present financial crisis will be over before the end of 2010 if not before, so buying these companies now and holding the stock until they move rapidly back up will give cash hoarding investor’s significant return on their investments. The big question now is other than institutional investors, who has that kind of cash? BM

Additional Source; Compiled from various published and internet sources

Related Topics:
Continue Reading
Click to comment
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Businessuite Markets

Jamaican Teas Exiting Real Estate Activities As Nonrecurrent Loss On Sale Of Bell Road Factory Impacts Latest Results

Published

3 days ago

on

April 28, 2024

By

John Mahfood Chief Executive Officer and Director Jamaican Teas Limited has released the following report for  the Second Quarter Results to March 2024

Jamaican Teas Limited is pleased to report growth of $218m in its adjusted profits before tax for the half year to 31 March 2024 from $13.4m a year ago to $231 million this year before deducting a nonrecurrent loss of $92.49 million from the sale of its Bell Road factory in March 2024.

Manufacturing Division | Manufacturing revenues increased 11 percent in the quarter and 8 percent for the half year driven principally by a strong performance in the domestic market where revenues grew by 8 percent in the quarter and 18 percent for the half year. This performance was strongly influenced by the appointment of Wisynco as our new distributer for Jamaica on November 1, 2023. Export sales grew by 5 percent in the quarter and 3 percent for the half year.

Real Estate Division | No real estate sales were booked in the year ago quarter or half year as construction work on our new studios at Belvedere Road, in Kingston was still underway up to March 2023. Construction of this complex finished in Sept 2023 and sales of 7 units have been completed in the year to date.

Retail Division | For this quarter, retail revenues increased 11 per cent. This reflects a continuation of the accelerated revenue growth we have seen in our store in recent months. Our retailing profits increased by approximately 8 percent for the half year.

Investment Division | During this quarter, there was a reversal of the declines in the prices of stocks listed on the Jamaica Stock Exchange. The prices of stocks listed on USA Stock Exchanges continued to increase in the quarter. This resulted in significant unrealised gains in our overseas investments without a repeat of the offsetting investment losses on the local portfolio experienced in the year ago period.

Following from this, QWI Investments Limited (QWI) reported a pre-tax profit of $74 million for the quarter, a $102m reversal from their year ago loss of $28m. This builds on the positive trend seen in the first quarter, and resulted in a $238 million increase in the group’s total investment income for the half year.

REVENUES

JTL’s total revenues for the quarter increased by $134 million or 20 per cent overall from $666 million a year ago to $800 million this quarter. $86m of this increase reflected the absence of real estate revenues in the year ago period, as noted above. The half year revenues reflected a similar trend.
The increases shown in Investment Income mainly reflect the realized and unrealized overseas investment gains of QWI, partially offset by slightly lower dividend income and increased foreign exchange losses compared with the year ago period.

EXPENSES

Cost of sales moved from 78 percent of revenues a year ago to 80 percent this quarter. This apparently adverse trend is a reflection of low margin real estate sales this year versus no real estate sales a year ago. Adjusting for this year’s real estate sales, the gross profits of the manufacturing and retail divisions actually improved from 22.0 per cent to 22.5 percent in the quarter. The year to date gross profits showed a similar improvement.

A loss before deferred tax of $92.49 million was recorded on the sale of the Bell Road factory in March 2024. This is a non-recurrent expense and compares with the net revaluation surplus of $257.25 million recorded in prior financial years on the revaluation of this building between its acquisition and it’s disposal in March 2024. This surplus was forms part of the revaluation reserves in the company’s equity capital.

During the quarter, overhead costs increased slightly. For the year to date, the increase in overhead costs largely reflected increased costs for insurance and professional fees. The increase in interest expense during the quarter resulted from higher interest rates as well as increased short term borrowings by Jamaican Teas.

NET PROFIT

Net profit attributable to Jamaican Teas for the quarter after adjusting for the loss on the sale of the Bell Road factory was $73 million, a sharp increase from the $59 million profit in the same quarter of the previous year. Adjusted net earnings per share was 3.39 cents (2022/23 – earnings of 2.7 cents). The unadjusted net loss attributable to Jamaican Teas for the quarter was $18.99 million or 0.9 cents per share.

For the year to date, net profit attributable to Jamaican Teas after adjusting for the loss on the sale of the Bell Road factory was $114 million, a sharp increase from the $86 million profit in the previous year.

Adjusted earnings per share was 5.3 cents (2022/23 – earnings of 4.0 cents). The unadjusted Net profit attributable to Jamaican Teas for the year to date was $21.67 million or 0.9 cents per share.

FINANCIAL POSITION

The net decrease in fixed assets of $162 million since September 2023 is due mainly to the sale of the Bell Road factory building in March 2024 offset, in part, by the purchase of, and capital improvements and machinery purchases at, the Temple Hall factory.

The company moved its spice and dry pack production from leased premises at Montgomery Avenue to our Temple Hall factory in Feb 2024 and the tea division will be relocated during the third quarter of this financial year reuniting all the manufacturing activities into one facility.

The reduction in Investment properties since September 2023 reflects the sale of one of our buildings at Harbour Street, Kingston during the period. Efforts are continuing to sell the two remaining buildings at Harbour Street along with two other investment properties.

Housing inventories fell by $173 million due to the sale of the first seven units at Belvedere, while other inventories and receivables increased during the half year reflecting the increased scale of operations in our manufacturing activities.

OUTLOOK

In the half year to March 31 2024, the group has:
-purchased a new factory at Temple Hall and sold its Bell Road facility (subject to a short term lease back)
-transferred its manufacturing activities from Jamaican Teas Limited to Caribbean Dreams Foods Ltd, its wholly owned subsidiary
-installed two new co-General Managers at its manufacturing Division
-acquired new spice packing machinery that will facilitate a tripling of Saizon production adding up to $80 million in annual gross profit
-begun the process of exiting its real estate activities

In the next 6 months the group will complete its transfer from Bell Road to Temple Hall and continue the divestment of its real estate holdings. This is expected to make the group more cost efficient, better focused and more profitable. While many of the geopolitical developments taking place around the world are discouraging, the group is optimistic about its future.

For More Information CLICK HERE

Continue Reading

Businessuite Markets

Supreme Ventures Group Reporting EPS of 33.51 cents for Q1 ending March 2024.

Published

3 days ago

on

April 28, 2024

By

Gary Peart Executive Chairman Supreme Ventures Limited (SVL) Has Released The Following Interim Report To Stockholders For The Three Months Ended March 31, 2024

The Group recognized Gross revenues of $13.08 billion representing an increase of $218.46 million or 2% over Q1 2023. This was driven by Gross ticket sales of $28.69 billion (Q1 2023: 29.01 billion) and a payout ratio of 69.90% (Q1 2023: 70.91%) on our core product line being Lottery.

Direct costs amounted to $10.12 billion which was relatively in line with the prior year comparative period. Total costs include contributions to Government agencies and related bodies of over $2.71 billion. Supreme Ventures Limited continues to be one of the largest contributors to the Government coffers at multiple times our profitability.

The earnings per share is 33.51 cents for the first quarter ending March 31, 2024. The Group has proposed interim dividends to external shareholders of 30.16 cents for the three months ending March 31, 2024.

Total assets increased by $1.28 billion to $22.15 billion.

For the first quarter 2024, the operating segments recorded results of $1.32 billion, an increase of $360 million or 38% in relation to Q1 2023.

The Group experienced double digit growth in net segment results across all operating segments. Our lottery segment, sports betting segment and pin codes segment improved by 13.86%, 22.48% and 17.96% respectively.

Our customers continue to achieve record winnings as we focus on increasing customer engagement across the base. Our continued investment in new games and promotions will result in long-term customer loyalty and positive results in the medium to long term.

The Group generated positive cash flows from operations of $369.53 million to close on March 31st, 2024, with a cash and cash equivalents balance of $2.83 billion (Q1 2023: 3.26 billion).

The Group met all requirements and covenants under the terms of agreement with bondholders and other credit facilities during the quarter.

We continue to put back over 93.00% of our earnings into the Jamaican economy via prizes, fees, taxes, and operational payments.

Today, we can proudly say that since 2004 we have contributed more than $27.5 billion to
the government for good causes.

Innovation remains a key strategic focus for SVL. We introduced the exciting new jackpot feature to the popular Money Time game, giving customers a chance to win a minimum of $100,000 every four minutes. The Money Time Jackpot promotion was officially launched on March 3 with a vibrant campaign starring top dancehall producer Rvssian and new singing sensation Nigy Boy.

Innovation extended to the fast-growing sports betting segment. Our flagship sports betting brand JustBet unveiled a fresh new look, reflecting the company’s commitment to providing customers with an enhanced betting experience. The brand refresh was followed up with the launch of the customer promotion in partnership with Sportsmax offering football fans an opportunity to watch the 2024 UEFA Champions League Finals live at London’s iconic Wembley Stadium.

The Group, through its subsidiary Fintech entered the Remittance and Bill payment space, forging a strategic partnership with Ria Money Transfer to roll out Evolve Money Transfer in February 2024 at various Supreme Ventures Locations.

Our micro-finance subsidiary, Mckayla, has also continued its upward growth trajectory, by increasing its loan book by 19% since December 2023, through the development of ground-breaking loan solutions and targeting the underserved population.

For more information CLICK HERE

Continue Reading

Businessuite Markets

QWI Investments Performance Characterized By Strong Performance In Overseas Portfolios

Published

3 days ago

on

April 28, 2024

By

John Jackson Chairman of QWI Investments (QWI) has released the following report for the fiscal year ending September 2023

QWI Investments (QWI) continued the fiscal year ending September 2023 with a favourable second quarter profit before tax of $74.4 million versus a loss before tax of $27.8 million.

The quarter represented a continuation of the Company’s performance in the year ended September 2023, which was characterized by a strong performance in our overseas portfolios, partly offset by a weaker performance in the local stock market. Our overseas portfolio grew 27 percent in the quarter –better than the 22.5 percent growth in the S&P 500 and the 23.9 percent growth in the NASDAQ Composite index in the same period.

Market Backdrop

Market conditions in Jamaica, during the quarter, improved slightly, resulting in unrealised gains in the local portfolio.
The USA markets showed a strong increase in share prices as investors priced for continued
declines in interest rates in 2024.

QWI’s Jamaican investments, which represent 67 percent of the Company’s portfolio, produced $6.5 million of unrealised gains and realised losses of $6.2 million in the quarter — the latter as we rotated some of the stocks in the portfolio and reduced the Company’s bank overdraft.

In contrast, our overseas portfolio produced almost $156 million of unrealised gains.
The Net Asset Value (NAV) of the Company’s shares increased 3.2 percent from $1.25 in December 2023 to $1.29 at the end of March 2024.

This relative outperformance against the Jamaican indices reflects QWI’s exposure to the USA market, which saw significant gains in the quarter.

Unrealised exchange losses totalled $10.8 million versus $2.1 million a year ago.

Administration costs rose to almost $24.7 million compared to $24.2 million in the prior year

Statement of Financial Position

QWI ended the period with equity capital of $1.756 billion, up from $1.685 billion at end September 2023.
At the end of the period, the Company held US$4.4 million in equities listed in the USA and Trinidad and Tobago. The portfolio includes positions in several leading information technology companies, defense contractors and companies involved in housing and construction.

Investments in local and overseas stocks amounted to $2 billion with 67 percent represented by Jamaican listed stocks and the majority of the balance invested in the USA market.

Total borrowings at the end of March 2024 were little changed at $271 million.

Outlook

The Company’s Investment Committee actively monitors the investment portfolio and the markets in which we operate.
In the Jamaican market, Company earnings continue to be mixed while local interest rates, in particular the 30-day Bank of Jamaica CD, continue to rise, suggesting that sluggishness will persist in the short term.

In the USA, the outlook for significant interest rate cuts is receding, but this adverse trend has been offset by strong earnings growth for some companies and buoyancy in many economic indicators. Like the Jamaican market, this suggests that future opportunities will continue to be selective.

For more information CLICK HERE

Continue Reading

Businessuite Markets

Prestige Holdings Enjoyed A Strong Performance For First Quarter Of Fiscal 2024.

Published

1 week ago

on

April 23, 2024

By

Christian E. Mouttet Chairman for Prestige Holdings has released the following Consolidated Unaudited Results for the Three Months Ended 29 February 2024

I am pleased to report that Prestige Holdings enjoyed a strong performance for the First Quarter of fiscal 2024. Group sales increased by 10% to $341 million from $309 million in the prior year, which resulted in a Profit Before Tax of $15.3 million compared to a profit of $11.6 million for the same period in 2023, a 32% increase. Profit After Tax, attributable to shareholders, increased by 25% from $7.8 million to $9.8 million. Cash flow from operations was $26.9 million and we ended the quarter with $100 million in cash having reduced total borrowings by $5.8 million. During the period we remodelled 2 restaurants and ended the period with 134 restaurants.

All brands posted solid performances during the quarter, with our Subway and Pizza Hut results driven by improved operations, efficiencies and strong demand for our innovative menu items and value offerings. Top line sales were impacted by the opening of five new Starbucks restaurants at Brentwood, Aranguez, O’Meara, St. Augustine and Amazonia Mall, Guyana, when compared to the First Quarter of 2023.

I am extremely pleased to report that KFC recently achieved a significant milestone of serving 150,000 Harvest Meals. The Harvest Meal Programme, which has been active for two years, is designed to provide unsold KFC food to participating NGOs in Trinidad and Tobago. This unsold food is carefully packaged and transported, following accepted global food safety protocols, and is then repurposed into delicious meals and served to the less fortunate. We are very happy to have the opportunity to positively impact the communities in which we operate by partnering with NGOs to provide meals to those in need.

As mentioned in my previous report, significant investment is planned in this financial year for new store development, including Guyana, as well as the remodelling of existing assets in Trinidad and Tobago. We expect these developments, as well as our continued brand initiatives, to continue to deliver positive results.
For More Click THIS LINK

Continue Reading

Businessuite Markets

GraceKennedy’s Strategic Spur Tree Spices Acquisition: Positioning For Growth

Published

1 week ago

on

April 23, 2024

By

GraceKennedy Limited’s recent acquisition of an increased stake in Spur Tree Spices (Jamaica) Limited has positioned it as the second-largest shareholder in the company. With an estimated 338,410,375 shares now under its belt, based on Spur Tree’s issued share count of 1,676,959,244 ordinary shares, GraceKennedy solidifies its influence in Jamaica’s culinary landscape.

Continued Expansion through M&A

This transaction marks the latest in GraceKennedy’s series of mergers and acquisitions (M&A) activities, reflecting the company’s aggressive growth strategy. Following its acquisitions of Scotia Insurance Caribbean Limited and Unibev Limited in 2023, as well as doubling its interest in Catherine’s Peak Bottling Company Limited to 70% in February 2023, GraceKennedy demonstrates its commitment to diversification and market expansion.

Spur Tree’s Strategic Evolution

Meanwhile, Spur Tree Spices is undergoing a strategic transformation, expanding beyond spices and seasonings to become a full-fledged food brand. With plans to launch more than two dozen new products on May 1 and a brand refresh to reflect its new focus, Spur Tree is poised for a significant market repositioning.

Diversification and Innovation

In the upcoming quarter, Spur Tree Spices is set to unveil an array of innovative products, including their much-anticipated line of dried spices. This strategic move represents the company’s foray into new categories and a substantial expansion of its product offerings. By diversifying its portfolio, Spur Tree aims to capture a broader consumer base and solidify its position as a leading player in the culinary industry.

Implications of the Acquisition

GraceKennedy’s increased stake in Spur Tree Spices not only strengthens its position in the spice market but also opens doors for collaboration and synergies between the two entities. As GraceKennedy continues to expand its presence through strategic acquisitions, it can leverage Spur Tree’s innovative product line-up to bolster its offerings and tap into new market segments.

GraceKennedy Limited’s acquisition of a significant stake in Spur Tree Spices marks a strategic milestone for both companies. With GraceKennedy’s growing influence and Spur Tree’s strategic evolution, the stage is set for a dynamic partnership that promises innovation, growth, and market leadership. As they navigate the evolving landscape of Jamaica’s culinary industry, GraceKennedy and Spur Tree Spices are poised to redefine the future of food, one spice at a time.

Continue Reading

Trending

0
Would love your thoughts, please comment.x
()
x