Chemical and lubricants supplier Paramount Trading Limited is now pushing to unlock greater value from manufacturing as the company moves to double down on growth in this area.

With manufacturing now accounting for about 30 per cent of total sales, CEO Hugh Graham said the aim is to have at least 70 per cent of revenues coming from the production of lubricants, bleach and food-grade inputs.

Products carried by the company now span a wide range of household and industrial items inclusive of lubricants (lubes), construction and adhesives, and chemicals. Some of the most popular of which include fluids and oils, laundry and cleaning products, solvents, disinfectants and sanitisers, among others. Paramount, as a distributor of SIKA construction products, is also a manufacturer of lubricants for Allegheny Petroleum, which it produces under licence. This as it also holds the exclusive regional rights to distribute the products.

“Seventy-two per cent of our revenue currently resides in the distribution of chemicals with the remaining 28 per cent in our other four segments,” Graham said in his report published in the company’s recent annual report.

The other four segments making up the company’s operations are construction, transportation through haulage, chemicals and lubricants.

“With an aim to move a greater portion of Paramount’s revenue to manufacturing, we have spent more than $106 million on capital expenditure to prepare the company for this large leap,” Graham said.

With the company expecting to make more investments in its people, processes and certification, the CEO said this will help it to further expand production as it opens new doors for export to different jurisdictions.

The company, working feverishly to finalise its acquisition of premises on Waltham Park Road, has already indicated that the addition of the premises will help it to consolidate operations as it increases capacity to store more products, including labels, bottles and other raw materials.

The purchase of new electric forklift equipment has already been added to drive greater efficiency in the bleach manufacturing plant with a new engineer onboarded to steer operations in this area.

“With respect to lubricant manufacturing, we conservatively project that manufacturing these products at optimal production capacity would allow the company to bring in more than US$10 million in revenue before new engagements are formed in external markets. However, this target is predicated on the ability to operate for longer than what exists today,” Graham said.

“A similar train of thought also applies to food-grade inputs which is an extremely large market in the Caribbean. Paramount’s ability to manufacture these different products at scale would not only allow for import substitution with a Caribbean-made product, but for the earnings to remain within the region,” the CEO further said.

Now looking to move past a rare first-time loss, which totalled $14.4 million during the last financial year ended May 31, 2024, Graham said steps have been taken to cut cost in a number of areas, namely security and utility.

“While we won’t delve into some of the initiatives taken, we are using additional technological solutions to maintain necessary expenses while containing cost,” he said in the report to shareholders.

Paramount’s revenue at the end of year was $1.6 billion, 34 per cent below the $2.5 billion it secured in 2023. Despite the challenges, the company’s CEO in an outlook expressed optimism for future growth.

“Leading a business is never an easy endeavour, and losses are sometimes magnified more than victories. Paramount has produced 32 years of profits which far exceed one tough year. We will not dwell solely on one bad spot in 33 years of history, but we will work towards never having to report to our shareholders another full-year loss in our operations. Shareholders have become accustomed to seeing consistent profits and that’s what we intend to deliver in the future,” he stated.