Chief executive officer of KLE Group Limited, Gary Matalon, said the company has secured real estate board approval at the St Mary Parish Council for its construction projects.
The company is developing Bessa Villas, in partnership with Sagicor Group Jamaica, in the parish. The developers are already taking reservations for units.
The permits will allow KLE to begin the sales and marketing phase of the development.
Matalon said in remarks attached to the company’s six-month report, “Overall our main focus remains to return the business to a path of growth and profitability.”
As at June, KLE recorded its worst revenue figures since inception due to the impact of the COVID-19 pandemic.
The company ended the quarter in an overall net loss position after the inclusion of finance and depreciation charges and other comprehensive loss of $0.5 million as a result of losses in the revaluation of quoted investments.
KLE took over the Usain Bolt Tracks and Records Montego Bay franchise on January 7, 2020.
Total comprehensive loss for the period amounted to $44 million compared to $632 thousand in the prior period.
Three-month revenue (April – June) equalled $7.77 million compared to $52.15 million in the prior year.
Up to June 30, total revenue amounted to $80 million compared to $102 million in the prior period.
For the months April to June, the Montego Bay location was closed and the Kingston location opened for delivery and take-out only.
For the first half of the year, cost of sales amounted to $25 million compared to $29 million for the first quarter of 2019. Expenditure for the second quarter expenses were significantly reduced as the company went into cost-saving mode in reflection to the severe impact of the pandemic and the declining revenue.
Some of the expense reduction strategies employed included the laying off of team members, mandatory salary cuts for all staff and decommissioning of all heavy duty equipment.
Matalon said the company is reporting a loss from operations as a direct result of the bad debt write-off and the drastic decline in revenues in the quarter due to the corona virus pandemic.
Nevertheless, the company is showing positive working capital ratios with its current assets being greater than its current liabilities.
In this reporting period, current liabilities amounted to $68.8 million while total current assets amounted to $89.6 million.
Total assets as at June 30 amounted to $278 million compared to total liabilities of $223 million.
The company reported negative cash flow from operation and investing activities due mainly to the purchase of assets and increases in advances made to an associated company.
There was a positive cash flow from financing activities due to a related party loan.
Altogether, the company is reporting a net decrease in cash and cash equivalents at the end of the period of approximately $4.98 million.
Matalon said the company’s focus remains on cost containment “while we rework our product and brand to enable the company to thrive in the new realities facing full-service restaurants.”
KLE has restructured its senior management team, noting that changes made will have “a positive impact on the financial performance of the business in Q3 without jeopardising the operating standards we have worked so hard to build.”