Date: September 28, 2018
Lasco Manufacturing Limited (LASM) held its 80th annual general meeting today at the Knutsford Court Hotel. The meeting commenced with Chairman Hon. Lascelles A. Chin highlighting that the most recent financial year ended March 2018, was one of challenges and opportunities in which they continued to build the Company. The Company delivered gross profit of $2.4 billion, a 5% decline relative to $2.6 billion recorded in 2016. He highlighted this decline was attributable, to the significant increase in competitors entering the liquid portfolio market, with lower prices in aim of capturing iCool’s market share. In response, Lasco lowered their iCool prices by 30% (which affected the gross profit margin) as they ‘have no intentions of losing market share’.
Managing Director, Mr. James Rawle however indicated the Company’s outlook it still positive, as revenues and net profit are up 15% and 77% respectively, for the three months ended June 30, 2018. As Jamaica’s leading Nutritious Powered Beverage Company, Mr. Rawle indicated Lasco will continue driving research and development activities to ensure their products reflect consumer expectations and market trends with a strong focus on healthy and more nutritious alternatives.
Outlook for FY2019
As Lasco aims to improve their underlying profit margin from 14% in 2018 to 14.5%-15% for the ensuing financial year, the Company intends on achieving this through:
- Operational efficiencies – to deliver lower cost and savings
- Aggressive product innovation and launch of new products to enter new market segments in both powders and liquids
- Continued investments in their brands
- Growth in exports
- Balance capital investments in plant equipment and technology for the long term.
- Capital Investments of J$341 million
- New Warehouse – 65,000 sq ft- Completion for October 2019. This will improve internal logistics and provide additional holding capacity thus improving efficiency going forward.
- Oracle Upgrade
- Water Treatment Plant- completion for December 2018
- Capital Investments of J$341 million
- Investments in human resource development- training
- Maintain certification obtained and pursue others e,g, international certification (ISO)
Notably, Mr Rawle acknowledged emerging issues the Company will face within the next twelve (12) months:
- Regulation on sugary drinks in school and tax on sugary drinks in general
- Deposit Refund Scheme for Plastic (PET) bottles
Nonetheless, he highlighted the Company is ahead of the market as they have already started adjusting their sugar content in drinks two years ago. Currently, Lasco already has products that can enter into schools before the regulation takes effect on January 1, 2019. Proudly, he stated that the “iCool line has the lowest sugar content of similar products in Jamaica.”
With regards to the deposit refund scheme, he explained that manufacturing companies will now be required to pay into a fund, a deposit for each plastic bottle that they place into the market. This deposit will go towards funding the recovery those bottles and the processing & recycling of them. He thus indicated in the next twelve months this will be another cost incurred by the Company. Nonetheless he stated Lasco is prepared for this venture as they fully support protecting the environment
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