Following another record year where consolidated revenue jumped 19 per cent to a historic US$142.58 million ($22.10 billion), Caribbean Producers (Jamaica) Limited (CPJ) is looking to grow that figure to a quarter of US$1 billion over the next five years as it expands in Jamaica and St Lucia.

CPJ’s core business saw sales expand 22 per cent to US$118.86 million with net profit coming in 24 per cent lower at US$5.63 million ($872.85 million) due to US$1.6 million in settlements with Tax Administration Jamaica and Customs. Without this one-off event, CPJ’s company profit would have been US$7.22 million and consolidated net profit at US$7.84 million. This was achieved against the backdrop of a 70/30 split between the hospitality and retail segments compared to pre-COVID when 90-95 per cent of sales came from the hospitality business related to hotels and tourism.

“That’s a five-year plan. We’re moving that [budget] pretty dramatically this year. We’re building our retail business. We’re trying to add close to US$9 million in our retail channel and the new store in St Lucia is going to add about US$12 million a year in revenue. We have some hotels coming on stream for the second half of next year. So, that is what’s going to get us the US$20 million more from the US$142 million to US$170 million plus,” said executive chairman and interim Chief Executive Officer (CEO) Mark Hart in a call with the Jamaica Observer on Monday.

CPJ’s 51 per cent controlled St Lucian business delivered an eight per cent increase in revenue to US$25.25 million with its net profit doubling from US$437,171 to US$985,647 for the 2023 financial year (FY) ending June 30. This growth resulted in operational cash flow of US$1.48 million, which is the best performance since entering the Eastern Caribbean island in November 2015.

With CPJ now looking to hit US$170 million in revenue for its 2024 FY, the company will be spending US$3 million to expand the capacity of its manufacturing plant by 50 per cent, US$3 million on its new flagship supermarket at Orange Grove Centre and US$1 million on its solar energy system.

The expanded manufacturing plant for CPJ’s proprietary branded products should come on stream in its fourth quarter (April to June) of 2024 and start to have a material impact on sales by 2025. The new 16,000-square-foot supermarket will increase sales by an extra US$1 million per month once it’s opened by January and propel growth by an extra 25 to 30 per cent. According to co-Chairman Thomas “Tom” Tyler, the extra solar capacity will translate to over US$300,000 saved annually on utility costs which topped US$1.86 million in 2023.

As air traffic and the number of hotel rooms continue to increase, Hart noted that the company will remain busy focused in Jamaica while exploring possible acquisition opportunities depending on the circumstances. Tyler highlighted that they’re tracking more than 7,000 new hotel rooms to come on stream in the coming years and expect to materially grow in the future. CPJ is expecting to surpass the US$10-million mark in consolidated net profit by 2025 based on the current run rate.

There was a 16 per cent increase in passenger traffic at the Sangster International Airport to 468,700 passengers for August while year to date (YTD) metrics show a 24 per cent increase to 3.64 million passengers. This is materially above 2019 figures when 3.37 million passengers were processed in what was dubbed Jamaica’s best year on record for tourism.

When asked about the company’s search for a permanent CEO following the departure of Todd Stromme in September 2022, Hart told the Caribbean Business Report, “What we’ve found is the US CEO’s that we’ve been interviewing, and we’ve interviewed a lot of them, but we found that the business in the US is now so systematic, and formula driven, that it’s not really in sync with the way we run as a smaller, more nimble, customer-centric kind of company. Over there, it’s just about box in, box out, logistics, technology and we’re moving in that direction, but it still requires a different sort of person.”

As a result, Hart noted that the duo is looking at a local individual to fill the role which has largely been managed by both co-founders since the company’s inception. Dr David Lowe departed the CEO role in January 2020 after 3.5 years in the position.

CPJ’s total assets rose to US$90.11 million with current assets inching up to US$63.79 million, inclusive of cash and cash equivalents of US$5.46 million. Total liabilities and equity attributable to shareholders stood at US$57.83 million and US$28.91 million, respectively.

CPJ’s stock price jumped 10 per cent on Tuesday to $10.33 before ending Thursday at $9.43, which leaves it down 19 per cent YTD with a market capitalisation of $10.37 billion.

While Hart couldn’t quantify the impact of the Panama Canal delays, he noted that the company had US$38.91 million in inventory to carry it into the Christmas season and has agreements in place for freight cost. He also pointed to the company refinancing its debt and better approach to technology which includes a new enterprise resource planning (ERP) system which should come online by the second quarter of 2024.

“I am the biggest shareholder, so, of course, it affects me the most. I’d love to be pulling a big, fat dividend cheque, but we’re looking at the future of the company and saying let’s just grow the company and the profits. Hopefully, when the time is right, we will start to pay the dividend. The outlook is good and we’re coming into our happy selling season. We’ve beefed up our inventory a lot and we anticipate some really strong sales going into the next few months,” Hart said as he looked to the 2024 FY.