By: Anthony Morgan

At least one of THE ANALYSTS of Taking Stock believes that the financial services division of the Grace Kennedy group will be one to watch.

Senior Wealth Advisor at Ideal Portfolio Services, Orick Angus said while the division’s revenue line was fairly good in 2020, helping the company to record its best year ever, the figures were below the company’s projections. At the same time, he said that segment is where most of the company’s growth will likely be coming from year over year.

 “I expect to see that segment of the business really pushing the revenue margin for the company for some time to come,” said Angus.

All business segments within the group recorded increased revenue for 2020 compared to 2019. For the year, the GK group reported revenues totalling $115.5 billion, an increase of $12.3 billion or 12% over 2019. Net profit attributable to shareholders was $6.2 billion, a $1.7 billion increase over 2019, with earnings per share increasing by 38.9% to  $6.28 in 2020.

Angus said he was not surprised GK was able to record its best financial performance in its 99 year history as the group was growing year on year.

He said the company’s strategy over 2020 was to strengthen its supply chain, having been one of those essential companies during the health crisis.

“There was a lot of strategic initiatives throughout the COVID-19 pandemic that the company adjusted to see those numbers… $115.4 billion is ahead of their 2021 target of $100 billion so $15.4 is ahead of forecast and that’s very impressive,” said Angus. 

“$91.4 billion of that amount was just from the food segment alone and that figure is untouched by other players in the market,” he added.

Angus said shareholders are reaping the rewards of the company’s gains and he continues to recommend the stock as a good buy. Between January and March 8 this year, the company’s stock price went up over 40%.

“Shareholders are not only getting growth but are enjoying the best of both worlds with dividend payout. They had the biggest payout in the company’s history and that will increase as their profit margin increases,” he said. 

Meanwhile, Angus said GK will continue to prioritize operational efficiency this year to further manage costs as well as seek out strategic mergers and acquisitions in the market.

Particularly, Angus said he’s anticipating how the company plans to use its first Digital Factory, the announcement of which was made recently by Group CEO Don Wheby.

“Hopefully that comes out later this year. I don’t know exactly what the plans are and I’m looking forward to more information on that. I gather it will feature some tech advancements in the factory space to lesson operating cost for the company,” said Angus.

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