EFresh clawing its way out of losses
Everything Fresh Jamaica spent $59 million on the acquisition of majority holdings in EFresh Bahamas, a business that in 2021 was the sole profitable segment within the pandemic-battered group’s operations, its yearly audited results show.
The Bahamas trading division’s incorporation in group assets midway in 2021 was part of the fix EFresh needed to pull itself out of losses it had racked up when business from its main market, the tourism sector, crumbled amid a global lockdown on travel.
At the close of 2020, EFresh had made losses of $181 million, far greater than the $83 million in annual losses the company had recorded even before the outbreak of COVID-19. Last year, its losses dwindled to $27.5 million as the company began reducing its exposure to the tourism market and as the Jamaican economy and hotel sector began to revive.
EFresh Bahamas mostly trades in the retail sector. Over the seven months, the division has contributed 19 per cent of group revenue, making it the second-largest contributor behind Jamaica. The group also has business in the meat industry through Meat Experts Limited – a business it had acquired back in 2019 but has since been restructured into an import-distribution operation to contain losses.
Everything Fresh Jamaica revenue jumped to $1.6 billion at the close of year ending December 2021, but its sales still lag behind the 2019 top-line numbers at $2.2 billion.
“In 2021, sixty per cent of total sales of the company were derived from the hotel industry as compared to 46 per cent in 2020. However, when comparing the second half of each year, the sales by the company to hotels grew by 300 per cent in value as room occupancy increased in 2021,” the company said in its earnings report.
The Bahamas subsidiary, which is less dependent on the hotel industry, recorded steady profits of $14.8 million in the seven-month period ended December 31, 2021.
The Jamaican trading division closed the year with losses of $15.9 million, down from $128 million a year earlier; while losses from the meat plant were down to $26 million from $49.7 million a year earlier.
The rebalancing of its revenue mix towards retail markets continues this year.
“In 2021, the company continued to add new products to the retail offering. Management also increased the merchandising capability during 2021 to better serve supermarket customers,” the company said.