Now controlling 70 per cent of Catherine Peak and 100 per cent of 876 spring water brands, food and financial services group GraceKennedy Limited (GK) is looking to further grow its two line of bottled water products with new variations.
Making the disclosure at the company's annual general meeting on Wednesday, Group CEO Don Wehby stopped short of telling the near 150 shareholders in attendance physically and online exactly how the company will go about its plan to add more stock keeping units (SKUs) and new flavour profiles to the water products.
"We have a really good strategy for both brands in terms of growth, which we expect to grow double digit as we move along, now only just scratching the surface we also want to move into doing variations," he stated, refraining to divulge too much details for the sake of maintaining competitive advantage.
Increasing the 35 per cent stake in Catherine Peak it acquired in 2018 to 70 per cent earlier this year, Wehby said the decision to up its ownership in the water company was aligned to the growth strategy of its heavy weighted GK foods division, which seeks to acquire top local brands having broad consumer appeal.
"We see opportunities to expand Catherine's Peak distribution outside of the local market, through line extensions and exports to the Caribbean and US markets, and we are eager to bring new innovations to the brand in the future," CEO of GK Foods Frank James had commented.
The remaining 30 per cent of Catherine Peak is owned by Spike Industries Limited, previous owners of the popular spring water company.
The 876 water brand, which, on the other hand, has been on the market since 2017, was previously produced by UniBev Limited. Prior to its purchase by GK in 2021, the product was already marketed by World Brands Limited, a GK subsidiary.
The GK group, which has been pushing to grow its revenues outside of Jamaica, now capped at 56 per cent to 70 per cent by 2030, has in the last year undertaken significant capital investments as it retools to make operations more profitable and agile.
GK's Chief Financial Officer (CFO) Andrew Messado, in his report to shareholders, said that last year alone the company invested approximately $3.8 billion in new assets to grow the business for the future. Total assets for the company at the end of March stood in excess of $200 billion.
"We are investing heavily in technology with over $900 million in new software as well as over $200 million in new equipment to drive that was spent," Messado stated.
"Outside our retail expansion, factory merger, solar energy projects among other expenditures – we also continue to make investments in our core operating systems to drive efficiency across the business. Our SAP S/4 Hanna version of the application is being implemented this year and we will be spending US$6.9 million to ensure that we are using the most up to date technology within our food business. On the financial services side, we have the Oracle Fusion which is a software that was developed to drive our accounting systems in a standardised manner across all financial services in the group, we're now in phase two of this project with a US$2.3-million spend. These two applications alone represents about $1.4 billion as we invest in technology to grow the business," the CFO added.
Its flagship GK One app, which was developed to drive synergies across the business, is now being prepared for roll-out to markets in Trinidad and Guyana following a successful local launch. Concerning the Guyana market, Wehby also said that an application was also now made to secure general insurance licence in that country.
Pleased with first quarter out-turns which returned record revenues of $39 billion backed by profits of $2.3 billion, the CEO said he was already upbeat and positive about 2023 being a good year for the company, especially now when it looks to deliver on the objectives of its 2030 vision which largely seeks to build-out GK's base as a global consumer group.
"I believe we will realise our vision as we move throughout the years to becoming the number one Caribbean brand with Jamaican roots and a global reach. This, as we build on our pillars of food and financial services, providing strong returns on investment for our shareholders and improved quality of life for team members, customers and the community," Wehby said, also noting that pending its engagement of US-based platform Nasdaq to help with the development of its economic, social and governance (ESG) framework, an impact report is expected to be ready by the end of this year.