Ready for market - Caribbean Flavours to supply sugar, salt reducer to regional manufacturers
Published:Monday | August 27, 2018 | 12:00 AMAvia Collinder/Business Reporter
Caribbean Flavours & Fragrances Limited (CFF) is now rolling out a salt and sugar reducing agent for distribution to the beverage and baking trades in Jamaica and the Caribbean, under the brand name Flavour Fit.
The product - to be made locally by Caribbean Flavours on behalf International Flavours Fragrances (IFF) - has more than 100 applications, depending on the needs of the manufacturers, says Derrick Cotterell, managing director of the Jamaican flavour company.
Caribbean Flavours' personnel underwent training in Mexico and the United States over 24 months and are now ready to roll out the product in Jamaica. IFF bears the cost of supplying the technology required to produce the applications, while Caribbean Flavours foots the training costs.
Cotterell's company, Derrimon Trading, is the majority owner of Caribbean Flavours. IFF is a listed New York flavour company is present in 34 countries and makes US$3.4 billion in sales annually, according to information on its website.
Cotterell said CFF will be the exclusive distributor for Flavour Fit across the Caribbean, and that the company was already laying the groundwork to bring the products to market in various countries, including Barbados, St Kitts-Nevis, Trinidad & Tobago, Guyana, Grenada and the Dominican Republic, while weighing interest from manufacturers in Cuba and Haiti.
The Jamaican company is already selling the product in Canada and plans to deepen that market.
The technology supplied by IFF, Cotterell said, involves use of either a natural or artificial product, the choice of which is determined by the manufacturer. Its application cuts sugar content by 50 per cent, but its effect on salt content is dependent on the taste profile desired and requirements of the client, he added.
Caribbean Flavours expects the new business line to grow revenue by 30 per cent, which Derrimon Chief Financial Officer Ian Kelly described as a conservative estimate, but neither Kelly nor Cotterell would comment on the additional capacity or volume output from the project.
Since 2017, Caribbean Flavours has invested $30 million in new equipment, including homogenisers and mixers, to increase capacity and quicken the pace at which products roll off the production line. Those funds are part of an ongoing $50 capex plan that includes training and factory upgrades.
The added capacity, meanwhile, will feed both local and export markets, according to Cotterell who expects foreign sales to contribute 10 per cent of revenues.
In its current push for organic growth, Cotterell said Caribbean Flavours is working on the roll out of new products, including new essential oils, as well as a return to the production of ginger extracts using raw materials tapped directly from farmers and through the Ministry of Industry, Commerce Agriculture & Fisheries.
For the past one-year period ending June 2018, Caribbean Flavours made a profit of $87.21 million on revenues of $423 million, its unaudited financials show. The previous year, the company made $82.8 million from revenue of $410 million.
Caribbean Flavours' financial year end is being revised from June to December, to align with parent company Derrimon's reporting period. Its next audited statements will, therefore, reflect performance over 18 months, Cotterell reported at Derrimon's annual general meeting last week.
Derrimon acquired majority control of Caribbean Flavours in 2017 in a deal with the company's founder Anand James. Since then, the trading company has reduced its stake to 62 per cent, having sold 13 per cent to an entity called Digipoint Limited.
The deal with Digipoint was solely a sale of shares, which made it the second largest owner with holdings of 8.99 million units in the flavour company.