Lasco Manufacturing is reporting that its $600-million capital investment last year is now paying off with net profits for 2018/2019 almost doubling to just over $1 billion.

The major capital investment item was the completion of an additional 65,000 square feet warehousing space at its White Marl plant in St Catherine, which led to an expansion of the powered manufacturing operations, which are both bearing fruit. This investment in these two areas contributed significantly to net profit moving from $561 million in the 2017/2018 to just over $1 billion for the period under review.

The capital investment also included the extension of the dry blend plant to increase space, the completion of a waste water plant and the purchase of two additional forklifts.

Lasco Manufacturing, which is listed on the Jamaica Stock Exchange junior market, is primarily involved in the manufacturing of soy-based products, juice drinks, water and the packaging of milk-based products from its White Marl plant.

Managing Director James Rawle was more than pleased with the returns from the capital investments, as he addressed the company’s annual general meeting on Monday at The Knutsford Court Hotel in Kingston. Rawle said the investments have resulted in gains in operational efficiencies at Lasco Manufacturing.

He disclosed that the waste water plant is to be completed in a few weeks, pointing out that the company is serious about protecting the environment and the investment in this plant is one such example. Rawle identified other initiatives in waste reduction, packaging reduction, which will reduce packaging waste, prudent water management and waste water treatment.

He emphasised that new warehousing space has increased the company’s storage capacity and thereby bolstered efficiency and generated important savings.

Moving forward, the Lasco Manufacturing managing director said the company will be focused on operational efficiencies, as investments will continue in the brands combined with aggressive product innovation and launches of new products to enter the market in both the powdered and liquid segments.

He said there will be renewed attention on growing the export market, with the Caribbean being given significant attention, arising from the vast potential which it holds, as well as North American, which have strong Jamaican pockets that have taken to the Lasco brands.

The Lasco Manufacturing boss pointed out that “last year the company invested $286 million in marketing to support brands in both local and export markets, supported by six new product launches, sponsorship, corporate social responsibility and trade activities.”

Turning to the financials, Rawle reported that revenues for 2018/2019 were $7.57 billion, an increase of $906 million or 14 per cent over the $6.7 billion recorded for the corresponding period last year. Total assets at year end were $8.79 billion, an increase of 14 per cent over the prior year.

Selling and administrative expenses inclusive of marketing and promotional spend for the various brands were $1.5 billion or 4.7 per cent above the spend in the prior year. Lasco reported in its 2018/2019 annual report that, “this out-turn reflects a much-improved efficiency in various expense lines but particularly in marketing and promotions spend, where the approach was more strategic and the clarity, consistency and relevance of the consumer messages improved.”