BICO takes big hit to half-year profit

The steamy, hot days impacting Barbados have not translated into increased profits for the island’s main ice-cream producer, BICO Limited.

The century-old company was impacted by a massive 40 per cent drop in half-year profits. However, it is promising to keep all its staff as it tries to correct the situation.

In its unaudited financials and executive summary for the half-year ending March 31, 2024, the publicly listed ice-cream manufacturing and cold storage company took a major hit in net income, when compared to a similar period in 2023.

According to the published numbers, the company’s trading revenue of $7.59 million, was slightly more than the $7.58 million recording for the corresponding period in 2023. The figures also showed operating income dropped from $765 762 for the half-year of 2023 to $614 218 this year. This represented a near 20 per cent fall-off.

The Harbour Road, Bridgetown based company, which had its plans to merge with a Trinidadian group nixed by the Fair Trading Commission (FTC), recorded a pretax net income of $299 173.

Meanwhile, long-serving executive chairman of BICO, Edwin Thirlwell said the significant reduction in half-year performance was “due largely to weak sales growth in our ice-cream and food services distribution trade coupled with margin pressures from increased competition and high input costs”.

According to Thirlwell: “Whilst we experienced a reasonably strong first quarter, revenue growth slipped considerably in the second quarter, resulting in an overall decline in profits over the six-month period. Results from our Harbour Cold Store operations, though positive, were lower than expected as recovery of high energy cost remains a challenge.”

The senior executive told stakeholders in the filing that despite the big drop in performance, BICO would continue to maintain “a full complement of staff while continuing to push for improved efficiency in its operations”.

BICO’s executive chairman explained that over the second half of the financial year, the company’s focus will be on improving its distribution and pricing structure so that it can meet the expectations of stakeholders and customers.

Last year, the FTC blocked a move that would have allowed Trinidad-based HADCO Ltd, the parent company of Creamery Novelties Ltd, to take over the operations of BICO.

The regulator said such a business consolidation would have resulted in a “substantial lessening of competition” in the market.

However, Thirlwell later criticised the FTC decision, stating: “We believe the decision was not in the best interest of consumers, employees or the 350 BICO shareholders who were denied the opportunity to sell their shares at the attractive price offered.”

(IMC1)