Disappointing 2025 for Caribbean Cream going into the red

Exhibiting much resilience, cutting operating expenses by $32-million 

Durrant Pate/Contributor

The financial year ended February 28, 2026, was a disappointing one for Caribbean Cream, as the company went into the red, reversing the prior year’s modest $18.5 million profit.

The loss in profitability comes against the background of one of the most challenging periods in the company’s recent history, where the economic headwinds faced tested its resilience in ways that extended beyond business and into the lives of employees, customers, and communities as a result of the October 28, 2025 passage of Hurricane Melissa, the strongest hurricane to have hit the country at Category 5.

Caribbean Cream, which trades as Kremi recorded a net loss before tax of $125.8 million, reversing the modest $18.5 million profit made in the previous year, primarily due to lower-than-expected sales in the latter half of the year. Despite these challenges, management successfully implemented initiatives to reduce operating expenses while achieving targeted sales objectives. 

Chopping expenses

Direct and operating expenses also contributed to this outcome, as management continues to review and refine its processes with the objective of controlling and reducing expenditures to improve profitability. Total operating expenses declined by $32 million, or 3%, to $1.016 billion, compared to $1.048 billion in the prior year. 

These expenses comprise administrative, selling and distribution, and finance costs. Admin expenses, the largest component of operating costs, amounted to $824 million, representing a decline of $44 million or 5% from 2025. The decrease was driven primarily by reduced spending on repairs to buildings, as well as lower costs for security and sanitation services. 

The management remains focused on reviewing operational efficiencies and implementing targeted improvements to achieve its strategic goal of increasing profitability amid prevailing economic conditions. Throughout the year, Kremi maintained consistent product availability across its distribution network and increased sales through third-party contractors. 

However, Hurricane Melissa significantly disrupted operations, resulting in reduced sales due to the temporary closure of distribution and depot facilities. The situation was further compounded by extensive damage to the Montego Bay depot, which remained non-operational throughout November 2025.

Financial overview 

Revenues for the financial year remained relatively flat at $2.9 billion compared to 2025. Prior to the hurricane, revenue performance was 9% ahead of 2025 but operations were adversely affected by Hurricane Melissa, which impacted overall results. With the reopening of the Montego Bay depot, Kremi was able to recover lost sales. 

These recovery efforts enabled the company to achieve revenue levels comparable to those of the previous year. Kremi’s strategy to improve working capital management, remains a key priority, as it continues to meet its short-term loan and debt obligations as they fall due. 

No additional loans were incurred during the year, and capital investments in property, plant, and equipment (PPE) were funded through operational resources. Cost of sales for the year was $2.089 billion, up from $1.935 billion for the similar period last year. 

This represented an increase of $154 million or 8% due to increases in our maintenance and waste disposal costs. During the year, the cold room experienced a major mechanical breakdown and corrective measures were implemented, ensuring uninterrupted service and our continued ability to meet customer demands. 

Measures have been implemented to address other production constraints, resulting in improved production capacity and availability of products. Kremi continues to leverage its strengths to deliver exceptional value to Jamaican consumers at affordable prices, in an environment characterised by rising costs and inflationary pressures.

A significant milestone during the year was the commissioning of Kremi’s water well in December 2025. The well has reduced utility costs, lowered the risk of production interruptions, and lessened the impact of drought conditions on the business operations. 

Beyond the immediate financial savings, it enhances the resilience and sustainability of the company’s manufacturing platform.