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| SEPROD CEO Richard Pandohie |
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| Minority shareholder leader Orett Staple |
2016 was a positive year, which saw Seprod accelerating its expansion
efforts, growing its international business and rolling out an impressive
innovation pipeline.
Let us briefly walk through the major business units that
have occupied our discussions over the last couple years.
Golden Grove Sugar Company
Sugar is a sweet product but, for us, the financial results
over the years have been bitter. With the approved marketing agency status
which enabled us to market and distribute our own sugar, the financial losses
were reduced. Our Golden Grove brand is
now synonymous with high quality sugar and first class presentation. With the implementation
of the revised sugar packaging and labelling standards on July 1, 2017, we
expect the Golden Grove brand to take an even greater share of market.
Our fields and factory operations are much improved; we were
very optimistic about achieving breakeven in 2017 but continuous adverse
weather conditions have destroyed that ambition.
We will continue to strive to make this operation viable, to
not onlystop the further destruction of shareholder value; but also in an
effort to continue one of the only economic activities in Eastern Jamaica and
more so, in the forgotten parish of St. Thomas.
Serge Island
Farms
The farm operation was much improved; milk production and
productivity continue their positive trajectory. We presented a proposal to the
Government that spoke to a public/private sector partnership to double milk
production, bring back small farmers to the industry, and in general, begin to
reverse the catastrophic decision in 1994 that liberalisedthe importation of heavily
subsidised milk powder that resulted in the near total decimation of the local dairy
industry.A few discussions were held but nothing substantial has emerged; we
have accepted that to make any headway, we will have to start on our own,
working with the farmers and hopefully the Government will join eventually.
Factory
In the factory,our innovation pipeline continued to
flow. Consumers have embraced our evaporated
milk, condensed milk, whipping cream and of course, our lactose free milk. The
investments made in Research & Development have been, and will continue to
be, substantial; this will be the backbone of creating sustainable growth and
delivering above average returns for shareholders.
Jamaica Grain
& Cereals Limited
The Chairman has already spoken about this investment to
enhance our corn milling facility and enter into the flour market; arguably the
largest industrial project undertaken in Jamaica in recent decades. We are
proud to have a state of the art, best in class facility right here in
Kingston. We anticipate not only producing our own brands but doing private
label manufacturing for 3rd parties.
Ladies and Gentlemen, can there be any doubt about our pledge
to grow the business and grow
shareholder value?Your
company is committed to growth.The principles that guide our growth commitment will
continue to bebuilt on the following pillars:
Innovation&Renovation
Consumers and Customers will continue to experience new
products in all aspects of our operations; not just dairy and sugar; for
example, we have launched low fat and vegan margarine that you can see in the
display booths. We will also be innovative in our technology and the way we
interact with our consumers and customers.
Building Economies of Scale
This is critical to driving down our unit cost of production
which will enable us to be price competitive in the local and export markets.
We have to maximize our manufacturing capacity; as, in many cases, we are
competing on an unfair playing field with persons who are either abusing
loopholes in import regulations, or with import products that are being heavily
subsidized in their countries of origin.
As a manufacturer, employing more than 1,000 Jamaicans and
having invested over $5Billion in the last 3 years, we are constantly facing
higher cost and more stringent requirements to do business; however, some
entities can simply bring in containers, have very little investment in the economy
but are allowed to undermine and destroy legitimate manufacturing investments.
Let us be clear, we have no problem with competition but it must be on a level
playing field; the rules cannot be selectively applied for the benefit of a few
and to the detriment of many.
High Performance Culture
Another pillar is building a performance culture by
attracting and investing in talented persons. I am proud that our company has
taken on young graduates of the University of the West Indies, University of Technology,
College of Agricultural Science &Education and the Caribbean Maritime
Institute, who will work in the organization, gaining valuable work experience
and being the first cohortto develop a talent pool to drive Seprod to higher
heights. Today, we have some of our new interns in attendance. Our young people
are talented and ambitious, they just need an opportunity.
Mutually Beneficial Partnerships
·
We want to expand our partnership with our
farmers.
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We want partnership with the Unions to improve
productivity. Jamaica continues to struggle with a culture of low productivity
that puts us at a competitive disadvantage in the global village.
·
We want to partner with Government to make
Jamaica a place of choice to live and to raise our families; creating
employment opportunities that will allow persons to break the poverty cycle.
·
We are partnering with educational institutions
to build human capacity.
·
We will continue to develop a value-added partnership
with our consumers to bring them competitively priced, nutritious and healthy
products; for example, we have been proactively reducing the sugar content in
our products and have embarked on a redevelopment campaign that will see making
our products healthier.
·
We want to partner with our employees, to be an
employer of choice and create a culture and environment of which they will be
proud to be a part.
Ladies & Gentlemen, Seprod is heavily invested in
Jamaica and has been an indelible part of the Jamaican landscape for 78 years.
We are a significant player in this country and it is our responsibility to be
a key agent in making Jamaica a better place for ourselves and the generations
to come.
We implore our Politicians & Technocrats to be truly
committed to the growth agenda and not compromise the fledgling growth
possibilities, through ill-advised taxation measures and poor policy decisions.
We implore the various Government agenciesto partner with
manufacturers. It cannot be that they are forcing manufacturers to outlay hundreds
of millions of dollars for every conceivable compliance; but then have no
resources in place to stop persons bringing in goods that are flagrantly
violating the country’s labelling requirements, not paying their fair share of
dutiesand utilizing illogical loopholes todestroy legitimate businesses.
We are cautiously optimistic about the country’s outlook;
there is evidence of economic growth occurring, but it must be nurtured
carefully.We stand in solidarity with all well thinking Jamaicans in condemning
the level of criminality in our nation; crime has been an albatross around our
neck, devaluing our lives, destroying our economic growth and increasing the cost
of doing business. We can be so much more.
I want to end by thanking the Chairman and the Board for
their confidence and support, the Management team for their passion and
commitment to the cause, and to each and every employee in the company for the
contribution you are making to ensure that we can truly say “Made at Seprod, mustbe
good’. I want to thank our consumers and customers, without you, the dream would
not be possible; and finally, our shareholders, for their continued confidence."
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