Kremi budgets US$2m for energy conversion project
Ice cream maker Caribbean Cream Limited, which trades as Kremi, is looking to invest US$2 million, or $288 million in local currency, in a combined heat and power or CHP plant.
The company says it is in discussions with liquefied natural gas or LNG suppliers, including New Fortress Energy, about powering the plant.
Kremi has been dealing in the production of bulk ice creams and products for 15 years. In the past two, it expanded into the production of frozen novelties, and is making plans to grow even further. In recent months, Kremi has invested $60 million in the acquisition of neighbouring property to continue its expansion and before that opened a depot in May Pen, Clarendon, and Ocho Rios, St Ann.
But while the ice cream maker is heavily focused on driving up revenue, CEO Christopher Clarke is also looking at initiatives to improve business efficiencies, including the company’s energy footprint, among other programmes.
Last year, for example, Kremi entered into a shared service agreement with related company Scoops Unlimited Limited, aimed at reducing administrative costs. Under the agreement, finance, marketing, human resources, information technology functions are shared by both companies and centralised at one location.
This year, Clarke wants to knock off the energy project from the company’s to-do list.
“We are not tied to a supplier of LNG as yet, but we are looking at our options. We, however, expect it to be done sometime during this calendar year,” he told the Financial Gleaner.
The conversion to gas will start at Kremi’s 3 South Road operation in Kingston. A decision is pending regarding its South Camp Road facility for which it has plans to build a new cold room.
Steam produced by the CHP plant will be used for general cleaning of the ice cream factory or to pasteurise products, which is the process of using mild heat to eliminate pathogens and extend the shelf life of perishables.
Kremi’s earnings have been resilient during the pandemic, with profit of $85 million over nine months ending November 2020, earned from $1.3 billion of revenue.