The price of flour dropped this year, but the profits and revenues of National Flour Mills have been on the up for the first nine months of 2023.
In the company’s financial report published on Friday, Chairman Nigel Romano confirmed that for the first three quarters of 2023 NFM earned revenue of $431 million, a 16 per cent increase over the comparative period in 2022 while gross profit also increased from $59 million in 2022 to $110 million in 2023.
This represented a gross profit margin yield of 25 per cent, which he explained fell more in line with international benchmarks for businesses involved in the manufacture and marketing of flour and feed products.
NFM earned a profit after tax of $26 million, which was a dramatic increase compared to the $1.7 million loss the company declared for the same period in 2022.
Despite the increased revenue and profits, Romano still feels the company still has work to do.
He said, “These results can be attributed to several factors, including improved operational efficiency, reductions in grain prices, improved product offerings and closer collaboration with our commercial and retail customers. While the experts are predicting that grain prices will remain favourable due to increased supplies from the United States, Russia and Ukraine, the very volatile geopolitical environment and the impact of a change in climate suggest the need for prudence. Additionally, the escalation and spread of the Israel-Hamas war poses a major risk to the global economy in the form of higher energy prices and trade disruption, which could result in increased prices for soybean meal and corn.”
Romano however said the company was still mindful of the impact of climate change, which has resulted in extreme weather patterns impacting the food supply chain.
He said, “If countries fail to implement the necessary measures to arrest this, the impact on global food supplies could be devastating. Climate change is also posing a significant threat to water levels in critical locations such as the Mississippi, from which we source most of our wheat, and we are carefully monitoring these variables.”
Romano said NFM planned to continue to upgrade its plant and machinery to modernise our operations.
He said, “Within the next few months, almost all our consumer products will be packaged using new technology, which would improve our operational efficiency and by extension, our overall efficiency. In addition to the upgrade of our technology and equipment, we are streamlining our processes and working to further enhance the competence and commitment of our people. We are well poised to continue our transformation as we enter 2024.”