Woodcats International Limited, a subsidiary of the Derrimon Group, is looking to venture into more finished products as it moves to extract greater value from wooden pallets manufactured by the company.

Chairman and CEO of the Derrimon Group Derrick Cotterell, speaking at an annual general meeting this week, outlined the move as part of a wider group strategy which seeks to not only diversify the company’s product offering but to also significantly grow its revenues within the next two years.

Cotterell, which had previously noted that there was no great profit that could come from pallet manufacturing as a single operation, said that the plans to move up the value chain in pallet value-added and other lumber products are now taking off with hopes to grow legs in the segment.

“We’re now in the stage of developing products, so we are looking at more value-added in the form of furniture and other finishes that can come from pallets as we believe that there are lots more we can do with the product. We are therefore now looking at all our options as we continue to push some larger plans for future growth and expansion across all our subsidiaries,” Cotterell told the Jamaica Observer.

Woodcats, having been in operation since 1999, was acquired for more than $350 million from founder Christopher Collings in 2018. The acquisition at the time, which formed part of Derrimon’s plans to diversify its core business, saw it moving into a new segment, one outside its previous operation which was largely concentrated in the areas of food manufacturing and grocery retailing. Woodcats now providing a full range of pallet solutions for warehouse storage and export, also reconditions and repairs used pallets. It also produces shipping boxes, crates, lobster traps as well as garden mulch which it distributes under the Summerland brand.

The Derrimon Group, which last year secured record revenues of $18.4 billion and profits of $617.6 million, saw combined out-turns from its Caribbean Fragrances and Woodcats businesses accounting for about $1.8 billion of total sales up from $1.3 billion in 2021.

“As we go after new opportunities and look to close on a number of our plans for 2024, we want to deliver more value-added for Woodcats, offering more than just pallets to the market,” Cotterell said.

“We are rightsizing the different businesses so that the profitability of the company can be sustained so that we can be able to do what we need to in the short to medium term. We have been blessed that most of the companies we have bought are generating the returns we want,” added Ian Kelly, chief financial officer.