Ongoing supply chain disruptions and weaker market demand for some products pushed Lasco Manufacturing Limited’s (LASM) revenue down 10 per cent to $2.92 billion.

The beverage and food product manufacturer had a $326.99 million haircut on its top line for its first quarter ending June 30. This is a sharp contrast to previous years where the company was growing its revenue in previous periods at a double-digit rate. The addition of geopolitical and trade issues saw LASM’s revenue dip below Q1 2024 which exceeded $3.24 billion.

“Notwithstanding we continued to invest in our long-term growth drivers, including targeted marketing and promotional spend, capital investments in equipment, technology and re-skilling and up upskilling of our technical teams,” stated Chairman and Managing Director James Rawle in his report to shareholders.

This weaker demand pushed the company’s gross profit down nine per cent from $1.24 billion to $1.12 billion. However, the company’s gross profit margin improved from 38.02 per cent to 38.42 per cent which reflected tight cost management.

Despite the company’s top line declining, it cut its operating expenses by three per cent to $382.89 million. After accounting for a 25 per cent reduction in other operating income to $101.86 million, operating profit dipped 14 per cent from $976.29 million to $841.62 million. With lower finance costs and taxes, LASM’s net profit decreased 12 per cent from $701.68 million to $618.33 million.

“We continuously monitor for potential challenges that may adversely affect our business. As in the past, we will respond with agility and foresight, implementing measures to address and mitigate any negative effects. Our focus remains on allocating resources to initiatives that support volume growth and, consequently, gross margin expansion,” Rawle explained in his outlook.

Although LASM’s capital expenditure (capex) was negligible during the quarter, the company reported that it had accounted for $1.8 billion as pre-payments on specialised capital equipment under trade and other receivables. Although LASM didn’t explain what kind of equipment was being purchased, this is likely going to be spent on a new production line at its White Marl, St Catherine facility.

The company’s 2025 annual report revealed that it spent $425 million on capex with a focus on automation and digitisation across various departments and streamlining the manufacturing process.

LASM’s total assets increased seven per cent during the quarter to $19.75 billion with $2.47 billion in inventory, $4.64 billion in short-term investments and $3.11 billion in cash. The company had $4.22 billion in total liabilities with the company taking on $762 million in debt to partially fund its capex projects. The company’s equity base four per cent to $15.54 billion.

LASM’s stock price was $6.71 on Tuesday which left it down 15 per cent year-to-date with a market capitalisation of $27.80 billion. The company paid a $0.19 dividend totalling $787.15 million on July 24.

“Achieving organic, profitable, and sustainable growth is our core objective. This goal depends upon ongoing enhancements in productivity and efficiency, as well as our commitment to innovation, product development, and strategic investments in both consumer engagement and brand strengthening. These efforts are supported by careful investment in plant, equipment, technology, and workforce development,” Rawle noted.