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GraceKennedy Reporting Revenue And Profit Ahead Of Half-Year Targets

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Donald G. Wehby, Group Chief Executive Officer for GraceKennedy Limited (GK) has released the following report on the company’s financial results for the six months ended June 30, 2022.

During the first half of 2022, GK achieved revenues of J$72.59 billion, representing an increase of 14.6% or J$9.24 billion over the corresponding period in 2021. Profit before tax (PBT) was J$5.46 billion or $12.6 million higher than the corresponding period in 2021.

Net profit attributable to stockholders was J$3.70 billion, $111.6 million higher than
the corresponding period in 2021. Earnings per stock unit for the period was J$3.73 (2021: J$3.62).

GK remains cautiously optimistic as we continue to manage the business through the challenges presented by high inflation globally, sustained supply chain issues, increasing interest rates, and foreign currency volatility. Notwithstanding the difficult economic climate, revenue and profit are ahead of our half-year target, and our team remains unwavering in their commitment to GK and focused on the execution of our strategic initiatives.

Performance of Business Segments

Winna Terms & Conditions - Grace Foods

Foods
GK’s food business recorded an overall growth in revenues when compared to the corresponding period of 2021.

PBT recorded an increase, however there were mixed results across the segment, reflecting the dynamic nature of the current economic environment within which we operate. Challenges included higher distribution costs, resulting in compressed margins.

Our Jamaican food distribution business continues to do well and recorded healthy growth in both revenues and pre-tax profits. Our next generation product portfolio, which includes Grace Sardines, Grace Tuna, Grace Mighty Malt and Grace Aloe, displayed growth over the corresponding period last year. Key products such as vienna sausages, frankfurters, and the Tastee Cheese and Tropical Rhythms lines reported strong growth over 2021.

World Brands Services (WBS) recorded a strong performance, with increases in both revenues and PBT over the corresponding period in 2021. This was driven by the growth of signature brands such as Frito-Lay, Capri Sun, Lucozade, and Mars. Consumer Brands Limited (CBL) also reported significantly increased revenues and PBT.

Both WBS and CBL continue to prioritize the expansion of their distribution points and have renewed customer engagement through in-store promotions.

GK’s chain of supermarkets in Jamaica, Hi-Lo Food Stores, remains focused on improving service levels and customer satisfaction. Strong growth in revenues and PBT were recorded during the period and Hi-Lo’s e-commerce platform continues to receive positive feedback from our customers.

GK’s Manufacturing Division achieved growth in revenues and PBT compared to the corresponding period last year, due to solid performances by Grace Agro-Processors (Hounslow), Dairy Industries Jamaica Limited (DIJL) and Grace Food Processors (Meats). The merger of two of our factories in Jamaica, National Processors (Nalpro) and Grace Food Processors (Canning), into NALCAN, is on track to be completed in 2022 and will bring greater efficiency to our manufacturing operations in Jamaica.

Our international food business recorded improvement in revenue over prior year; however, record inflation in all territories, as well as elevated distribution costs resulted in mixed performance results.

GraceKennedy Foods (USA) LLC (GK Foods USA) delivered good revenue growth over prior year. PBT was impacted by high demurrage and storage costs, for which corrective measures have been put in place. Cost saving and margin management initiatives continue to be implemented to help mitigate these conditions.

Grace Foods UK Limited reported a commendable performance, achieving growth in both revenues and PBT. The company remains challenged by high commodity prices and the high cost of trading in Europe due to BREXIT.

Notwithstanding, the food service side of the business has rebounded with significant improvements in both revenue and profitability compared to the prior year period.

Grace Foods Canada Inc. closed the second quarter of 2022 with revenues exceeding prior year; however, record inflation in the Canadian market and supply chain challenges affected margins and impacted PBT. Key products including Grace Corned Beef, Grace Mackerel and Grace Canned Peas remained popular, which helped to drive top line growth.

Grace Foods Latin America and the Caribbean (GF LACA) reported positive half year numbers with growth in both revenues and PBT being attributed to the strength of the Grace brand across the region. GF LACA was successful in negotiating the listing of Grace Sardines and Grace Coconut Milk in PriceSmart Barbados, and launched Grace Coconut Milk regionally, and Grace Coffee in Guyana.

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Financial Services
The GraceKennedy Financial Group (GKFG) reported a positive performance for the period, as we continue to expand our regional footprint.

Our Banking and Investments segment yielded positive results, led by GK Capital Management Limited (GK Capital), the investment and advisory arm of GKFG. GK Capital sustained its growth momentum into the second quarter of 2022, with revenues growing significantly compared to the same period last year. This positive performance was largely buoyed by the two successful initial public offerings of Spur Tree Spices Jamaica Limited and Jamaica Fibreglass Products Limited and GK Capital’s increased non-interest revenue streams.

GK Capital has signed an agreement with the largest operator and manager of mutual funds in the Caribbean, the Trinidad and Tobago Unit Trust Corporation (TTUTC). The new venture, which remains subject to the requisite regulatory approvals, will allow GK Capital and TTUTC to partner in the distribution of mutual funds in Jamaica.

First Global Bank (FGB), GK’s commercial bank in Jamaica, continues to achieve growth in its loans and deposits portfolios when compared to the prior year. FGB’s revenues increased over the same period last year and PBT recorded growth. For the remainder of 2022, FGB will continue to focus on implementing its digital strategy, including online credit card applications and other digital alternatives to in-branch transactions.

SigniaGlobe Financial Group Inc., GK’s jointly owned merchant banking business in Barbados, continues to show significant growth in retail loan and non-interest income revenue over the corresponding period of 2021. As a result, profitability over the period has doubled when compared to prior year. GraceKennedy Money Services (GKMS) reported a decline in revenue and PBT for the period, primarily attributed to lower remittance flows and the volatility of the Jamaican dollar against the US dollar.

The Bank of Jamaica has reported a decline in remittance inflows since the start of the year, and we have put strategies in place to address this which are focused on marketing, pricing, agents, compliance, and our customers.

Bill Express and FX Trader continue to perform well, and recorded growth in both revenues and PBT. GKMS remains focused on improving and expanding its digital channels and service levels.

GK’s Insurance segment continues to benefit from our recent acquisitions and recorded double digit growth. GKFG’s most recent acquisition, GK Life Insurance Eastern Caribbean Limited continues to implement its strategy to maximize the performance of its portfolio while establishing itself as a major pan-Caribbean insurer. Key Insurance Company Limited continued to produce positive results, recording growth in revenues and PBT during the first half of 2022.

Canopy Insurance Limited generated revenue growth over prior year in all business segments and remains focused on revenue diversification and the pursuit of strategic partnerships. The company remains challenged from a profitability perspective, driven primarily by medical inflation. Allied Insurance Brokers Limited is focused on strengthening and growing client relationships and leveraging partnerships.

GK General Insurance Company Limited (GKGI) outperformed its prior year revenues due to growth in its core business portfolios. An initiative which was implemented in the first quarter of 2022 to optimize GKGI’s structure and internal processes, as well as keen partner relationship management, have improved efficiency and service delivery and remain key to the company’s growth strategy.

Digital Transformation
The GK One mobile app was released in the Google Play and Apple App stores in March with the Bill Payment feature enabled. Customers can now also receive a Western Union remittance via the app, directly to their mobile wallet.

The Visa prepaid card associated with the app has been dubbed the “Shelly” card as it features an image of our outstanding Jamaican sprinter and GK Ambassador Shelly-Ann Fraser-Pryce. Customers have expressed excitement upon receiving their “Shelly” card and are responding positively to the ease of use of the GK One app and card. Additional money services are on target to be rolled out via the app in the coming months.

Mergers & Acquisitions
GK continues to advance its Mergers & Acquisitions (M&A) strategy. Following the acquisition of Bluedot in the second quarter of 2022, the M&A Unit continues to hold discussions regarding M&A transactions locally and internationally, as we move towards achievement of our 2030 objectives.

GraceKennedy Limited on Twitter: "GraceKennedy is 100! Happy 100th Anniversary GK Family! #GK100 #OurStoryIsYourStory #TheBestIsYetToCome https://t.co/zRJUJGFB04" / Twitter

GK100
GK100 continued to be prominently featured at events, in campaigns and customer engagement activities during the second quarter of 2022. Following a special celebration at the 2022 ISSA/GraceKennedy Boys’ and Girls’ Champs in April, our 100th anniversary also featured prominently during the Jamaica 60 Diaspora Conference in June. Since 2004, GK has been a legacy partner of the Diaspora Conference, which is convened by Jamaica’s Ministry of Foreign Affairs and Foreign Trade. On the evening of the first day of the Conference this year, the GK team hosted in-person and virtual participants to a mini-concert, which featured performances by Jamaican reggae artistes Tony Rebel and Ding Dong, and highlighted GK100.

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Sygnus Real Estate Finance Strategically Increases Stake In One Belmont From 70% To 86%

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Results of Operations

SRF continued the transition between its first and second investment life cycles with a number of key initiatives, namely:

  • Strategically increased its stake in the 9-storey One Belmont commercial tower asset from 70% to 86%;
  • Increased its investment in income generating third-party real estate investment notes (REINs) by 25.3% to J$2.30 billion; exited J$1.72 billion of investments;
  • Paid its first dividend of J$0.2012 per ordinary share in December 2024.

Primarily as a result of the increased stake in One Belmont, SRF generated a net profit for Q2 2025 versus a loss in the similar period last year, and a lower loss for 6 Months FY 2025 versus the similar period last year.

Book value per share increased 5.0% to J$24.05 compared to J$22.91 last year, given a J$372.06 million or 13.5% increase in retained earnings to J$3.13 billion as at the end of the period.

SRF continued to advance the ongoing execution of interior build-out works for some tenants of the One Belmont property, and the monetization of its partial exit from the One Belmont investment; and advancing the value creation process for the Mammee Bay hospitality asset in St. Ann and the Lakespen industrial asset in St. Catherine.

The Group remains dedicated to executing its strategy of unlocking value in real estate assets to enhance shareholder value.

For Q2 2025, total investment income or core revenues was J$152.25 million compared to negative J$24.35 million for the three months ended February 29, 2024 (“Q2 2024”). While total investment income or core revenues was J$26.59 million for 6 Month FY 2025 compared to negative J$55.31 million for the six months ended February 29, 2024 (“6 Month FY 2024”). This was primarily due to increased lease and other income, a gain on disposal of financial instruments of J$33.73 million, a gain on acquisition of shares in Joint Venture of J$162.20 million, and share of gain on joint ventures of J$39.26 million. The gain on acquisition of shares in Joint Venture resulted from SRF’s strategic decision to increase its exposure to the One Belmont commercial tower. On a net basis, SRF’s overall income from this asset was J$209.95 million for 6 Month FY 2025.

The weighted average fair value yield on REINs was 8.7% compared with 4.3% last year, with the weighted average yield on REINs measured at amortised cost being 14.4% vs 13.5% last year. The increases noted were due to the redeployment of capital into higher yielding real estate investment notes. The weighted average fair value yield on REINs is expected to improve significantly during the current financial year as SRF continues to substantially increase its exposure into third-party income-generating assets.

The weighted average cost of debt was 9.0% compared with 7.6% last year. This result was due to a higher interest rate environment as well as SRF securing longer duration debt. One of the tranches of SRF’s 2024 capital raise has a variable interest rate structure, which becomes effective after the first year which SRF expects to benefit from as market interest rates move downwards.

The share of gain on joint ventures amounted to J$15.63 million for the quarter ending February 28, 2025, compared to a nominal loss of J$0.51 million last year, while the share of gain on joint ventures was J$39.26 million for 6 Month FY 2025 compared to a loss of J$0.81 million last year. This was mainly driven by SRF’s increased ownership stake of 86% of the Audere Holdings Limited joint venture and SRF’s 71.0% ownership in the newly formed joint venture company referred to as 5658 LMR Limited, whose underlying assets are two (2) resort villa properties located in Ocho Rios, Saint Ann.

SRF’s total investment income consisted of various activities aimed at unlocking value from its real estate investment portfolio, namely: interest income, lease income and commitment fees related to REINs; gain or loss on property investments or on exited real estate assets; and share of gain or loss on its joint venture investments.

Due to the nature of its business model, SRF may experience fluctuations or “lumpiness” in total investment income and net profits during interim reporting periods, which usually stabilizes by the end of each financial year, as evidenced by the FYE Aug 2024 results relative to the interim quarterly performance. The Group uses independent appraisers to value its investment assets annually. All investment properties are USD investment assets which are converted to JMD for financial reporting purposes. SRF’s key strategic assets are held via wholly owned subsidiaries or joint ventures.

For the three months ended February 28, 2025, net investment income or core earnings was J$66.75 million versus negative J$113.22 million last year. While for the six months ended February 28, 2025, net investment income or core earnings was negative J$160.21 million versus negative J$228.10 million last year. The increase recorded during the quarter was mainly attributable to SRF’s gain on its acquisition of additional shares in Audere Holdings Limited, increasing its stake in the joint venture from 70% to 86%. For FYE August 2024, SRF generated J$508.50 million in net investment income.

Net profit for Q2 2025 amounted to J$38.24 million relative to a loss of J$187.15 million last year, while net loss for 6 Month FY 2025 amounted to J$197.45 million vs a loss of J$320.13 million in the corresponding period last year. The improvement for both periods was mainly due to gains on investments executed during the quarter. SRF generated an average annual return on equity (ROE) of 19.1% over the past five years of its first investment life cycle through the end August 2024.

Basic earnings per share (EPS) was J$0.12 for Q2 2025 relative to negative J$0.57 last year, while diluted EPS was identical to basic compared to negative J$0.53 last year.

Basic earnings per share (EPS) was negative J$0.60 for 6 Month FY 2025 relative to negative J$0.98 last year, while diluted EPS was identical to basic compared to negative J$0.91 last year.

Similarly, basic core earnings or net investment income per share (NIIPS) was J$0.20 for Q2 2025, compared with negative J$0.35 last year. For 6 Month FY 2025, basic core earnings or net investment income per share (NIIPS) was negative J$0.49, compared with negative J$0.70 last year.

Dr. Ike Johnson Director Sygnus Real Estate Finance Limited 

For More Information on Sygnus Real Estate Finance Limited (SRF) Unaudited Financial Statements Quarter Ended February 28, 2025(Q2-2025) CLICK HERE

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Express Catering’s Outlook Is For An Excellent Summer Season

The winter season is now ending but the outlook is for an excellent summer season and we are ready to serve our many patrons.

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Ian Dear CEO and Director Of Express Catering Limited (ECL) Has Released The Following Third Quarter Interim Report On The Operations Of The Company For Fiscal 2025. The Report Is For The Quarter And Nine Months Ending February 28, 2025.

Total passengers accessing the post security departure lounge of the Sangster International Airport during the Third Quarter was 652,656. This generated revenue of US$7.43 million for a spend rate per passenger of US11.38.

For the similar Quarter in the prior year, 705,116 passengers accessed the departure lounge. Total revenue of US$7.04 million was earned at a spend rate per passenger of US$10.05.

Despite the decline in passenger totals, total revenue and spend rate improved. The improvement in spend rate is particularly important as the increase was significant and is a result of the strategic measures that the company has been implementing over time.

Net profit earned for the Quarter was US$1.77 million for an EPS of 0.108 US Cents per share. This is compared to a net profit of US$1.06 million for an EPS of 0.065 US Cents for the similar period in the prior year.

For the nine months to date, the passenger total was 1.80 million. This generated revenue of US$18.89 million for a spend per passenger rate of US$10.49. The metrics for the similar nine months in the prior year were passenger total of 1.96 million passengers, revenue of US$18.67 million and spend rate of US$9.53.

Net profit for the nine months was US$3.22 million for an EPS of 0.197 US Cents. Net profit earned for the similar period in the prior year was US$2.09 million, for an EPS of 0.127 US Cents. Dividend declared and paid for the fiscal year to date was just over US$1.00 million.

Of all the cost categories, Cost of Sales (COS) continues to be our best area of savings for the Quarter and year-to-date positions.  This category registered just under seven percentage points improvement for the Quarter and just under five percentage points improvement for the nine months. The improvement was a combination of price increases, better portion controls, as well as improved supply chain agreements. The team intends to build on the trend for the rest of the year.

Savings were also recorded in Salaries and Wages, in line with the previously stated intention to better utilize this resource. There was also a shift in cost allocation from property rental expenses to lease amortization, in line with the increase in Lease Obligation under IFRS 16 rules. The team continues to review all cost categories for additional savings.

The winter season is now ending but the outlook is for an excellent summer season and we are ready to serve our many patrons.

For More Information CLICK HERE

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Knutsford Express Charts Strategic Course Amid Profit Decline and Operational Investments​

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Knutsford Express Services Limited (KEX) has released its unaudited financial statements for the third quarter ended February 28, 2025, revealing a nuanced financial landscape. While the company experienced a modest revenue uptick, net profits have seen a significant decline, prompting strategic shifts in operations and investments.​

Financial Performance Overview

For the third quarter, KEX reported revenues of J$593 million, marking a 4.8% increase from J$566 million in the same period last year. Over the nine-month period, revenues rose by 7.3%, reaching J$1.643 billion compared to J$1.531 billion previously.

Despite these gains, net profit for the quarter plummeted by 54.9% to J$49 million, down from J$111 million in 2024. The nine-month net profit also declined by 36.8%, settling at J$170 million from J$269 million in the comparative period.​

The company attributes the profit downturn to lingering effects of subdued passenger arrival numbers in Jamaica. Additionally, increased administrative expenses, particularly in staff costs, have impacted profitability. In the first quarter of 2025, administrative expenses rose to J$520 million, affecting net profits despite a revenue increase to J$592 million.

Strategic Investments and Operational Enhancements

In response to these challenges, KEX is investing heavily in fleet expansion and digital transformation. The company plans to inject J$500 million over the next three years to upgrade its bus fleet and implement advanced digital systems . This includes the introduction of airport-style departure gateways and digital ticket-checking kiosks, aimed at enhancing operational efficiency and customer experience.​

The Drax Hall depot in St. Ann has become a focal point for these innovations, serving as a prototype for the new passenger processing model. CEO Oliver Townsend emphasized the importance of these investments, stating, “We’re redoubling our investments and efforts on the core business and on initiatives that will improve our customer’s satisfaction”

Service Portfolio Adjustments

KEX is also refining its service offerings to align with market demands. The company announced the discontinuation of its international shipping and e-commerce service effective October 7, 2024, due to a 10% decline in revenue from overseas courier services . This strategic move allows KEX to focus on its core transportation and local courier services, which continue to be significant revenue streams.

Outlook

Despite current profitability challenges, KEX maintains a strong asset base, which grew by over 10.7% in the third quarter, reaching J$2.113 billion from J$1.926 billion the previous year. The company’s commitment to enhancing operational efficiency and customer satisfaction positions it for potential recovery and growth as market conditions improve.​

Conclusion

Knutsford Express is navigating a complex financial environment with strategic investments in infrastructure and technology. By focusing on core services and operational excellence, the company aims to bolster its market position and return to robust profitability in the coming periods.

For More Information CLICK HERE

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One on One Educational Services remains focused on strengthening One Academy

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Michael Bernard Chairman One on One Educational Services Limited has released the following unaudited financial statements for the 2nd quarter ended February 29, 2025.

Statement of Comprehensive Income Summary: 

Over the six months ending February 2025, company revenue was J$169.9 million, up from J$111.4 million for the six months ended February 2024. This represents a 52.5% increase over the comparative period, primarily due to the expansion of One Academy, which provides personalized educational solutions for schools, teachers and students. Additionally, the company retained its core annual recurring business from existing contracts, further strengthening revenue growth.

For the second quarter of 2025, revenue reached J$78.0 million, reflecting a 37.6% increase over the same period in the prior year. This growth was attributed to the expansion of One Academy and its ability to deliver personalized solutions through advanced technology, enhancing the accessibility and effectiveness of digital education.

Direct costs for the second quarter amounted to J$22.5 million, an increase of J$4.5 million compared to the previous year. This resulted in a gross profit of J$55.5 million, up 43.5% yearover-year. The increase in direct costs was primarily driven by expenditures related to One Academy’s live streaming of classes across the island  from the company’s central studio. Over the six-month period, direct costs also saw a 45.3% uptick due to one off investments in hosting infrastructure services and the installation of equipment and accessories to facilitate One Academy’s implementation of live classes. While these expenses have contributed to short-term cost increases, they are a strategic investment aimed at driving long-term value creation.

Administrative and selling expenses decreased by J$24.2 million, or 21.5%, over the six-month period, while the second quarter recorded a 19% decline over the comparable 2024 quarter. This reflects the benefits of cost-cutting initiatives aimed at improving operational efficiencies and financial discipline.

A taxation charge of J$226 thousand was recognized for the second quarter, primarily due to deferred taxation, bringing the six-month tax charge to J$894 thousand. The quarter closed with a net profit of J$7.2 million, a significant improvement compared to the net loss of J$19.9 million recorded in the same quarter last year. For the six-month period, net profit reached J$18.4 million, a strong turnaround from the J$41.4 million net loss over the comparative period.

Statement of Financial Position Summary:

Total assets grew to J$662.6 million at the end of the six-month period, reflecting an 8.2% increase from J$612.3 million in the prior year. This growth was primarily driven by investments in non-current assets, particularly the development of intangible assets. Total equity also strengthened, rising to J$423.4 million from J$362.6 million, supported by the company’s improved financial performance. This shift has allowed the company to move from an accumulated deficit of J$51 million to an accumulated surplus of J$9.5 million compared to the previous year. While, total liabilities reduced marginally by 3% year over year.

Statement of Cash Flow Summary:

The cash flow summary for the second quarter of 2025 highlights a substantial improvement in financial performance compared to the same period in 2024. Operating activities generated J$121.5 million in cash flow, while investing activities had reduced outflows. Additionally, financing activities reflected the company’s efforts to pay down loan obligations. These factors contributed to a net cash increase of J$66.7 million, leading to a stronger closing cash balance of J$110.0 million. This improvement underscores the company’s enhanced cash flow management and liquidity position.

During the quarter, the company remained focused on strengthening its One Academy suite of product offerings. This included the continued live streaming of lessons into high schools in Jamaica. Furthermore, the company leveraged its personalized solutions by developing a testing mechanism that allows schools to assess student performance effectively. This solution empowers schools with comprehensive student assessments, enabling the creation of targeted intervention strategies to improve learning outcomes.

In addition, investments continued in enhancing software architecture, particularly the further development of the integrated Education Management Information System (EMIS) and Learning Management System (LMS). These strategic initiatives reinforce the company’s commitment to advancing education delivery through technology, fostering impactful and accessible learning solutions.

These results reflect the company’s commitment to financial sustainability and operational efficiency while positioning itself for continued expansion and long-term success

For More Information CLICK HERE

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JSE launches Green Bond Plus Platform

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