Agostini Ltd subsidiary sends home 33 workers

Vem­bev, the com­pa­ny that dis­trib­utes Pep­si and oth­er bev­er­ages Ocean Spray, has been closed down and 33 em­ploy­ees sent home.

The de­ci­sion to close the com­pa­ny and get rid of 40 per cent of staff was made al­though its par­ent com­pa­ny, Agos­ti­ni Lim­it­ed, earned in ex­cess of $120 mil­lion in prof­its for the first nine months of the fis­cal year.

 

In an in­ter­view with Guardian Me­dia yes­ter­day, Agos­ti­ni Ltd man­ag­ing di­rec­tor An­tho­ny J. Agos­ti­ni said: “We closed the Vem­bev op­er­a­tion at the end of Ju­ly and 33 of the staff, we were not able to ac­com­mo­date them in oth­er parts of the busi­ness. So we had to let those 33 peo­ple go.”

Agos­ti­ni said the op­er­a­tion em­ployed ap­prox­i­mate­ly 80 peo­ple and rough­ly 47 em­ploy­ees were trans­ferred to oth­er com­pa­nies with­in the group.

Agos­ti­ni Ltd filed a ma­te­r­i­al change doc­u­ment with the T&T Se­cu­ri­ties and Ex­change Com­mis­sion on Ju­ly 30, 2019. How­ev­er, the com­pa­ny sought an ex­emp­tion from pub­lish­ing a no­tice in ac­cor­dance with sec­tion 64 of the Se­cu­ri­ties Act 2012.

In the rea­son for the ex­emp­tion, the com­pa­ny stat­ed: “The de­ci­sion to in­cor­po­rate all of the op­er­a­tions of Vem­bev in­to oth­er di­vi­sions will re­sult in sig­nif­i­cant cost sav­ings from name­ly re­duced op­er­a­tional costs with­out af­fect­ing qual­i­ty as­sur­ance or qual­i­ty con­trol as it per­tains to its prod­ucts.

“This change is ex­pect­ed to re­sult in over 60% of per­ma­nent em­ploy­ees be­ing re­tained through­out CDPT and all at­tempts will be made to as­sist em­ploy­ees who may be­come dis­placed, to iden­ti­fy suit­able em­ploy­ment with­in the Agos­ti­ni Group and/or ex­ter­nal to the Agos­ti­ni Group.”

Agos­ti­ni’s not­ed that the ma­te­r­i­al change is not ex­pect­ed to neg­a­tive­ly im­pact CDPT or, by ex­ten­sion, the Agos­ti­ni Group or its share­hold­ers and it, there­fore, deemed the dis­clo­sure re­quired by sec­tion 64 (1) (b) of the Se­cu­ri­ties Act 2012 un­war­rant­ed.

Ac­cord­ing to Agos­ti­ni, the com­pa­ny sought the ex­emp­tion from dis­clo­sure be­cause “it wasn’t sig­nif­i­cant in the over­all group.”

He said: “The fig­ures are not re­al­ly sig­nif­i­cant over­all, so we just told the SEC that we were mak­ing this state­ment as part of the chair­man’s re­port and we didn’t think we need­ed to go in­to any greater de­tail.”

Agos­ti­ni told Guardian Me­dia that group chair­man Chris­t­ian E. Moutett ex­plained why the re­struc­tur­ing took place in his third-quar­ter state­ment on Au­gust 14.

He said Vem­bev’s op­er­a­tions have been ab­sorbed in­to an­oth­er sub­sidiary of Agos­ti­ni, Caribbean Dis­tri­b­u­tion Part­ners Trinidad Lim­it­ed and two oth­er busi­ness­es, Hand Arnold and Vem­co, “be­cause the bev­er­age in­dus­try both here and world­wide have been go­ing through a lot of sig­nif­i­cant tran­si­tions.”

Agos­ti­ni not­ed that these tran­si­tions are dri­ven by con­sumer de­sire for low­er-sug­ar bev­er­age op­tions and al­so eco-friend­ly pack­ag­ing.

“So we be­lieve that those oth­er two com­pa­nies had stronger op­er­a­tions in the R&D and mar­ket­ing ca­pa­bil­i­ties and they would be in a bet­ter po­si­tion to meet the con­sumer’s needs and al­low us to be more ef­fec­tive,” he said.

He not­ed that the change would help them to fo­cus and grow the com­pa­ny’s in­ter­na­tion­al pro­pri­etary bev­er­age brands.

Agos­ti­ni said: “We would have said it in our last an­nu­al re­port that the stand-alone bev­er­age com­pa­ny was chal­lenged to pro­duce the kind of re­sults that we want­ed, so this was a way to try and deal with that as well.”

Al­though Agos­ti­ni not­ed that he did not want to stress on the 33 em­ploy­ees who have been sent home, he said the com­pa­ny will save as a re­sult of the move. He said oth­er cost-sav­ing strate­gies would in­volve “con­sol­i­dat­ing the in­ven­to­ry in­to two ex­ist­ing ware­hous­es rather than pay­ing for a third ware­house which we no longer have to rent” and “putting the goods on the ve­hi­cles that are al­ready go­ing to su­per­mar­kets with oth­er prod­ucts from VEM­CO and Hand Arnold will save on dis­tri­b­u­tion costs and so on.”

The com­pa­ny not­ed in its 2018 an­nu­al re­port that the group ac­quired Pep­si-Co­la Trinidad Bot­tling Com­pa­ny Ltd (“PCT”), the li­censee and dis­trib­u­tor of the Pep­si­co range of bev­er­ages in T&T. These bev­er­ages in­clude Pep­si, Moun­tain Dew, 7Up, Fizz, JuC, Peardrax, Cy­drax, Ocean Spray Juices and oth­er bev­er­age brands owned by Pep­si-Co.

Agos­ti­ni record­ed a prof­it af­ter tax of $122.5 mil­lion for the nine months end­ing June 30, 2019. For the same pe­ri­od, it gen­er­at­ed rev­enue of $2.5 bil­lion. The to­tal as­sets of the com­pa­ny as at June 30, 2019, stood at $2.4 bil­lion.

The CD­PL Group’s af­ter tax prof­it stood at $55.6 mil­lion for the year 2018.

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