Jamaica Producers Group Ltd (JP) earned net profits of $4.3 billion for the year ended December 31, 2016, compared to $614.57 million the year before.

The amount attributable to shareholders was $3.9 billion. Profit per ordinary stock issue was $3.51 for 2016 compared to $0.70 the year before.

The earnings were made on record revenues of $12.1 billion up from $8.7 billion- an increase of 39 per cent year over year, with a significant contributor being the recognition of Kingston Wharves Limited (KWL) as a subsidiary.

Group chairman Charles Johnston said the group is also reaping the rewards of a series of initiatives including investment in the business of logistics, and deployment of an acquisition strategy to build a diversified international specialty food and drink group.

In remarks attached to the year’s financials, he said, “Our strategy has been very successful when measured in terms of its return on investment and the overall accretion to the net equity of JP shareholders.”

For JP’s Logistics and Infrastructure Division -including businesses engaged in terminal operations, freight forwarding and logistics – year-to-date earnings before finance costs and taxation were $1.4 billion, up 258 per cent relative to the comparable period last year.

Revenues of $4 billion were up by $2.7 billion compared to the prior year. Johnston said the improved results for the division reflect strong business performances from both KWL and JP Shipping Services, a UK-based freight forwarder.

KWL, he said, benefited from growth in its domestic and transshipment cargo movements and in its services as a regional hub for motor vehicles. Investment continues in KWL, where the Group has approximately 200,000 square feet of warehousing, cold storage and offices in use, with an additional 160,000 square feet of warehousing and offices under construction, with completion scheduled for 2017.

For JP Shipping Services , results were partially offset by the depreciation of the pound sterling relative to the Jamaican dollar during the year.

JP Food & Drink Division — comprising companies engaged in farming, food processing, distribution and retail of food and drink with production facilities in Europe and the Caribbean — earned year-to-date revenues of $8 billion, up 10 per cent over the prior year.

Johnston noted, “We experienced strong sales growth in our juice business as we commenced production for new customers and new markets in Europe. Our international sales of rum cake and tropical snacks also increased, in part as a result of the depreciation of the Jamaican dollar.”

The division earned profits before finance costs and taxation of $31.2 million compared to $265.5 million for the comparable period last year.

There were restructuring and start-up costs in connection with the launch of a new Tortuga bakery and commercial centre in Kingston. The company expects that the initiative will improve the revenue and profitability of the division in 2017.

Johnston noted that JP Tropical Foods, a snack and fresh produce business, was adversely affected by poor farm yields during 2016 as a result of a significant increase in rainfall and other challenging weather conditions in St Mary.

He said banana production and sales are recovering, but typically take a nine-month cycle to return to their peak. Otherwise, the division continues to experience revenue growth in its pineapple business and export growth in snacks.

Johnston noted that the performance of the division also reflected higher raw material costs in the juice business and various start-up costs that were incurred as new juice co-packing accounts were launched and JP entered new markets across Northern Europe and also expandedthe range of new products.

It was noted that juice company, AL Hoogesteger Fresh Specialist BV, continues to be the division’s single largest business and is expected to continue to achieve market leadership and grow its pan-European customer base.

JP’s Corporate Services segment — a group financing, investment and corporate management operation — earned a profit before interest and taxation of $3.4 billion in 2016.

This result includes the gain from divestment of Mavis Bank Coffee Factory during the third quarter and the gain on recognition of KWL as a subsidiary during the second quarter.

The group plans to relocate all head office activities from Oxford Road to its food production complex in Cross Roads and to Newport West, a move which Johnston said was expected to support focused revenue growth and cost control.