KLE Group Limited, operator of Usain Bolt’s Tracks and Records restaurants, recently disclosed the latest plans in its restructuring exercise which see the entity shifting focus to its more lucrative property development business segment.

The restructuring, which began last year, sees the company’s restaurant operations and associated assets being transferred to T&R Restaurant Systems Limited (Franjam), an associated company in which KLE has a 49 per cent stake. Under the agreement Franjam is to assume “full responsibility for the liabilities associated with the restaurant operations, thereby relieving KLE of significant operating costs” as part of a non-cash transaction between the entities. By virtue of its stake in Franjam, KLE also retains its position to reap indirectly from the financial benefits of any turnaround fortunes of the divested restaurant business.

KLE, which has incurred heavy losses since the pandemic significantly disrupted its food and beverage business, has been forced to deal with numerous debts which over the last few quarters has adversely impacted performance. For the nine-month period which ended September, the group earned revenues of $117.8 million followed by continued losses of $57.9 million. Total assets for the period were also reduced to $203.9 million down from $272 million in the previous year.

“It was therefore the board’s considered opinion on the matter that the company required an urgent and significant restructuring of its assets and liabilities in order to protect against the further erosion of shareholder value,” the company said in a disclosure notice posted with the Jamaica Stock Exchange (JSE) on Monday.

“The effect of the restructuring is that the company’s focus will pivot away from operating a food & beverage business towards property development and management, while its balance sheet will become significantly streamlined and better positioned to power the company forward in a dynamic environment,” the company also said in its report.

As part of its latest focus on other segments which it described as significant and more substantially valuable, the group said it would now look to benefit from the revenues of its Bessa Development project.

The project being done in partnership with the Sagicor Group, which holds a 75 per cent interest and KLE the other 25 per cent, was now in the final phases of construction which will see the development of 86 luxury residences to be built on an eight-acre property in Oracabessa, St Mary. The units comprises 24 ocean front condos priced between US$260,000 and US$600,000; 12 pool villas priced at US$795,000 and 50 river condos priced between US$260,000- US$550,000.

The board, in its decision, further informed that amid this latest development it will also continue to pursue additional business opportunities as they arise, further expressing confidence that the current actions taken and the outcomes were likely to be in “the best interest of the company and its shareholders in the medium to long term”.