AML Foods has "capped" its debt after a busy 2012 and anticipates it will still have around $2.5 million in fixed deposits next year. Gavin Watchorn, the CEO of AML Foods, said the company will soon enter a period of consolidation whereby it draws its resources away from expansion and towards day-to-day operations. The firm's recent $10 million preference share offering allows AML Foods to run the business without worrying about financing, he said.
Calling the current debt level "sufficient", the CEO noted that some capital expenditures were paid through banking credit lines. "Now that the financing is in place, we have been able to balance everything back. Once we finish we'll still have around $2.5 million in fixed deposit for next year, which will be for Carl's Jr.," he told Guardian Business. "Carl's Jr. is beginning to gain momentum." That fast-food franchise, a first for The Bahamas, is the last project now on the table. The designs are complete, he reported, and construction plans are now receiving approvals.
AML Foods, however, has not yet revealed the location of the inaugural franchise. Watchorn said that a few staff members have already been hired. One staff member is in California for training, and three more are expected to join this employee in the next couple of weeks. Noting that a number of annual contracts are coming to an end, Watchorn felt the real key for the company will be decreasing overall operating costs through business synergies.
The overall dollar will increase, but as a percentage of sales, it should be lower. Essential for AML Foods, of course, is the high cost of energy. A strong campaign to boost efficiency at its various locations has been of continuous focus for executives. While this year AML Foods spent a cool $1 million on energy efficiency upgrades, 2013 should see a similar expenditure, although likely a bit less.
Watchorn told Guardian Business that the new stores are well equipped with the latest technology "We have a program though at our older stores to bring in efficient chillers air conditioning," he said. "We are pulling out all the equipment and we'll continue to do that into the next year. We don't have any choice. It is a little bit more from a capital expenditure prospective, but the benefit is immediate and long term." This period of consolidation will occur after the imminent opening of Solomon's Fresh Market at the Harbour Bay Shopping Centre next week. AML Foods is projecting $150 million in total sales across its network in 2013. It has hired 250 Bahamians over the last year through its new stores.
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