Ice cream and frozen novelties manufacturer Caribbean Cream Limited is feeling the pinch from the COVID-19 lockdown measures during the third quarter of 2021, with dwindling profits for the nine months of its 2021/2022 fiscal year.

The measures took a heavy toll on the company, which had a less than stellar combined three-quarter performance, as profit buckled under higher expenses caused by the lockdown. Caribbean Cream, which trades under the name Kremi, saw net profit attributable to shareholders dropping by 57 per cent to $36.27 million coming from $85.06 million booked during the comparable period in 2020.

This was after incurring taxes of $5.18 million for the period under review compared with $12.15 million in 2020. The publicly traded company incurred a loss for the November quarter amounting to $25.15 million as compared with net profit of $11.01 million.

The adverse impact of the lockdown resulted in administrative expenses climbing 26 per cent to close at $378.06 million, up from $300 million in 2020, as selling and distribution costs rose by eight per cent from $43.35 million in 2020 to $46.94 million for the period under review. Kremi reports that the increase in administrative costs was influenced by staff and related expenses for transportation during lockdowns, increased costs in electricity due to higher throughput and costs attributable to requiring above average levels of sanitation.

As a result operating profit for the nine months period amounted to $60.77 million, a decrease of 4per cent4 relative to $109.23 million booked in 2020.

The fall-off in profits would have been much worse had their not been a consistent rise in revenues last year. Revenue for the combined three quarters jumped to $1.54 billion compared to $1.33 billion in the corresponding period last year, representing a 15 per cent increase year over year.

Revenue for the third quarter rose 14 per cent to close at $500.51 million compared to $440.83 million for the comparable quarter of 2020. Kremi reported that their recently opened Ocho Rios depot was the force driving revenue.

This depot contributed eight per centto overall sales, as costs of sales amounted to $1.05 billion, up from the 2020 posting of $879.64 million, which was an increase of 19 per cent. For the quarter costs of sales went up 26 per cent to $375.67 million coming from the $297.91 million booked in 2020.

This was driven by increases in the cost for logistics, raw material and imported novelties. Finance cost rose 52 per cent year over year to $19.89 million relative to $13.10 million recorded in the nine months ended November 30, 2020.

Kremi reported a 47 per cent decrease in interest income for the period from $1.07 million reported in 2020 to $572,402 for the nine months ended November 2021.