The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

AML Foods chief executive yesterday admitted he was “a little frustrated” at the wait for construction approvals for its first Carl’s Jr outlet, while disclosing that store upgrades to its existing franchise would account for $500,000 of its upcoming $1.8 million capital expenditure programme.

Gavin Watchorn, who is also the BISX-listed group’s president, said building permits for the latest franchise were expected “any time now”, as he disclosed plans to enhance the customer experience and service at its 11 Domino’s Pizza locations.

A further $500,000 from the AML Foods capital expenditure budget, which is for the financial year that closes at end-January 2014, will be targeted at energy efficiency and savings - mainly at its Solomon’s SuperCentre and Cost Right locations in Nassau.

And, with Freeport now accounting for 40 per cent of AML Foods’ total business, the BISX-listed food retail and franchise conglomerate yesterday announced the appointment of former BEC and ZNS executive chairman, Michael Moss, to its Board of Directors.

Despite the building permit delays, AML Foods yesterday said it still anticipated opening the first Carl’s Jr outlet on New Providence during the 2013 first quarter.

Mr Watchorn, while declining to reveal its location, told Tribune Business that the inaugural outlet would require a $1 million investment and generate between 50-60 jobs when completed.

“We’re essentially waiting for the approval process to happen and then will be ready to press the button on it,” the AML Foods chief executive told Tribune Business.

“Any time now we expect that approval to come through. That will start it. I’m a little frustrated that we haven’t started it yet, but we need to make sure everything is correct and planned professionally. If we need to hold off a couple of weeks, so be it. It’ll come soon, once construction starts.”

Carl’s Jr, a US West Coast headquartered hamburger chain, will fight with the likes of Burger King and Wendy’s for a share of the burger market in the highly competitive Bahamian fast food market.

It will effectively put AML Foods head-to-head with Aetos Holdings, the franchise operator owned by Chris and Terry Tsavoussis, as both already have existing pizza chains (Domino’s and Marco’s) respectively. Now, AML Foods will be able to pit Carl’s Jr against Wendy’s, too.

Mr Watchorn yesterday confirmed that the agreement with Carl’s Jr required it to add one new location every year for five years, taking it to a five-strong chain in the Bahamas.

And the addition of its initial 50-60 employees will take AML Foods from its existing 862 staff to around a 910-920 strong workforce, making the company one of the largest employers in the Bahamas.

“Our capital expenditure, excluding Carl’s Jr, is $1.8 million, and about $400,000-$500,000 of that relates to Domino’s store upgrades,” Mr Watchorn told Tribune Business.

“We’re not adding new locations. We’re looking at all our stores and focusing on the customer areas. Where we have seating we will be upgrading them, making them more comfortable and modern, and where we don’t have seating we will add it.

“We’re focusing on enhancing the customer experience and customer service. Our programme will take us 24 months to complete, and we start that process this year.”

Detailing other priority areas for AML Foods during 2013, Mr Watchorn added: “We want to focus on energy, and we will be directing capital expenditure to energy saving materials.

“I would say that $500,000 of capital expenditure for next year will be directly energy-related. All the new stores are energy efficient, most of the Freeport stores are energy efficient, so most of the spend will be on the two Nassau stores - refrigeration and air conditioning.”

During the three months to end-October 2012, AML Foods saw a reduction in cash balances of $5.8 million.

This reflected capital expenditures on store expansions of $4.3 million, and a reduction in capital expenditure and insurance-related accounts payables of $1.2 million.