Jamaica Broilers Group Limited said this week that approximately $1.5 billion out of new financing of $6.4 billion raised in a recent bond issue and syndicated loan is intended for expansion in Jamaica and the USA.

Otherwise, the funds raised are being used to partly refinance the Company’s existing debt.

JBG advised via the Jamaica Stock Exchange that on February 4, 2016, the company raised $2.3 billion by the issue of a bond and said it had also borrowed $4.2 billion by way of a syndicated loan.

Ian Parsard, senior vice-president Operations & Finance, said Wednesday that the new financing would see replacement of approximately $4.6 billion in more expensive debt.

The interest rate savings is about 1.5 per cent on average, he stated.

The syndicated bank loans were led by NCB and included CIBC First Caribbean Ja and Citibank Ja.

Current financing is in three segments: a short-term or one-year financing facility of up to $1 billion priced at a variable rate; secondly, long-term amortising debt of $3.2 billion of a seven-year tenor and interest rate fixed at below nine per cent; and finally, bonds of a seven-year tenor which feature a bullet payment at year seven and interest rates fixed at a single-digit rate.

Older loans were used, he noted, as a mix of financing for working capital and various projects such as a new spiral freezer, grain silos and more.

Group borrowings as at May 2015, as reported in JBG’s annual report, totalled $5.18 billion with interest rates ranging from 7 per cent to 10 per cent on Jamaican currency loans, and 4.34 per cent to 6.19 per cent on United States currency loans.

The group also reported access to undrawn financing facilities amounting to $782 million.

JBG has been expanding in all its markets, with investment in a new hatchery in St Ann, Jamaica, planned for 2016 in order to meet increased demand for chicken meat.

In the wider Caribbean, the group said the Cayman market is also growing, with increasing sales of Best Dressed chicken to major and established retail outlets and also to the food service industry.

During the last financial year, the group also added the Turks & Caicos Islands to its regional markets.

JBG’s United States Operations comprising Wincorp International in Florida and International Poultry Breeders in Georgia and Arkansas recorded making much improved sales during the year, focusing on new markets and increased production.

JBG noted that it has started producing in new areas of the United States – resulting in the first fertile hatching egg marketing operation with access to production from three states.

“The US operation has grown to become one of the largest fertile egg marketing operations in the USA with customers in over 17 countries,” it was stated in the annual report.

Resulting from increasing business, the company has expanded cold storage, its trucking fleet, and has added new staff.

The US operations provide US dollar earnings to the group which had Jamaican dollar revenue of $26.7 billion during its last financial year. Net profit for the group was $1.93 billion, up 48.5 per cent over the $1.3 billion earned the year before.