Derrimon Trading Limited (DTL) Annual General Meeting held September 20, 2017 ,began with Director and CEO Mr. Derrick Cotterell welcoming the audience, shareholders and visitors. He then proceeded to read his report to the audience. Following this, Mr. Cotterell then gave a brief presentation on the company’s current happenings and overview of the company.

According to Mr. Cotterell  the key strategic imperative for Derrimon for 2016 was to, “solidify growth achieved in retail and ensure the distribution arm became more profitable for the future. This  was achieved through innovation and creativity.” An example of this was the introduction of the “Golden Brand” margarine, “the only brand in the market that has four sticks” rather than the two sticks butter present in the market. There were also some new products being distributed from the Linstead Market brand.

Growth in Retail

In the retail arm Derrimon added two more stores and currently owns and operates 7 Sampars and 1 Select Grocers. According to Mr. Cotterell the company is not currently seeking additional stores. The rebranding of Sampars done in 2016  has also been a part of the strategy to further solidify the retail arm.

Growth in Distribution

• Brands– The emphasis in distribution is to grow  the brands. Sun Detergent is one of the recent additions to the distribution set up and according to Mr. Cotterell, “it has grown tremendously and is now bigger”. The company is also expanding distribution in, “ Nestle, Jamaica Gold Sugar and their own brand Delect.
• Bulk Cold Storage– The company has undertaken reduction in its bulk cold storage operations as this has been difficult to manage.
• Chilled Beverages– There has been increased growth in chilled beverages sector and the company added a few new brands such as “Juiciful”.
• Bulk Dry Goods- DTL continues to perform well in the bulk dry Good as they are a major distributor of Cornmeal, rice and flour according to Mr. Cottrell.

 

 

Mr. Cotterell also stated that the company has placed a greater emphasis on managing Inventory, and has plans in place to keep inventory at its lowest possible. He then handed the meeting over to Mr. Ian Kelly Executive Director. Mr. Kelly began by stating that Distribution sales were reduced by 12% due to the culling of items which did not meet the  returns required by the company. This according to Mr. Kelly caused a reduction in revenue but same was compensated due to the increase in retail sales. Despite the flat performance in the top line the company saw Gross Profit growing by 12% due to the reduced cost from the culling of the non performing distribution line items. The company moved Gross Profit Margin from 13.2% in 2015 to 15.1% 2016 and the company will work to continue the same. Mr. Kelly reported that even with the anomalies reported in 2016 due to purchases of both the Sampars Crossroads and Select Grocers, that total cost only increased 5% year over year. This was done mainly through a significant reduction in trucking cost associated with non- performing brands that were culled.

Additionally, Mr. Kelly stated, “there was a 50% year over year increase in assets and no revaluation was done in 2016 which means that an increase is expected after the revaluation of same”. He pointed out that this was mainly due to the acquisition of additional CFF shares making it a subsidiary of the company. There was restructuring  of both United States  and Jamaican debt, to reduce finance cost and ensure the company grows at the most cost effective way. Mr. Kelly also heaped praises for the acquisition of CFF, and underlined that the value of CFF makes it acquisition an exciting one . He also expressed that the growth potential of CFF continues to be maximized to ensure the best performance of the group. Mr. Kelly also noted that, “the company is not worried by debt as he is confident that the company can grow at an average comfortable enough to sustain and reduce its debt burden. He stated that the company is now in a good  state after consolidation with CFF to service its debt with its cash flows and has reduced its debt to equity. Mr. Kelly closed by stating that the company is far ahead of where it was last year and with no one off cost to be incurred this year the company should be doing “extremely well” come December.