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Profit up at Carreras as company plans COVID cost cuts

Carreras Limited (CAR) made net profit of $3.58 billion on operating revenue of $14.13 billion for the year ended March 31, 2020,

This compared to profit of $3.40 billion made on operating revenue of $12.9 billion at March 2019.

Carreras is the leading marketer and distributor of cigarettes and tobacco related products in Jamaica.

The company indicates that it intends to cut eight per cent of costs plus apply other strategies, in a bid to offset any reduction in sales due to COVID-19 and its impact on the economy.

The company said, in notes attached to recent financials, that it was bracing for the impact of restrictions placed on bars, restaurants and mass entertainments events which were responsible for five per cent of its revenue.

However, at the same time, it noted that these restrictions were significantly relaxed by the government of Jamaica by the third week in May.

Cost of sales for the year ended were $7.13 billion compared to $6.47 billion. Administrative, distribution and other costs also climbed to $2.37 billion compared to $2.01 billion the year before.

Management indicated that the planned cut in cost is intended to improve efficiencies.

It outlined in other notes that the company was engaged in intensive programmes of cleaning and sanitisation and that staff were included in flexi-work arrangements.

The company is a publicly listed company with local and international ownership. Former Managing Director Marcus Steele stepped down from his role as the Managing Director of the Company, effective January 31, 2020.

Former Managing Director at Carreras, Marcus Steele

Raoul Glynn was appointed as the new Managing Director designate effective, February 1, 2020. Glynn, a Trinidadian National, previously held the role of Country Manager for Carisma Marketing Services, a British American Tobacco (BAT) subsidiary located in Trinidad, with responsibility for BAT’s operations across the English, French and Dutch Caribbean.

Jamaican shareholders own approximately 49.6 per cent of the company with the majority interest being held by British American Tobacco.

The company markets and distributes brands including Craven A, Matterhorn, Dunhill, Rothmans, Pall Mall, Newport and Parliament.