JM | May 12, 2022

Big surge in March quarter net profit at FosRich

/ Our Today


Admin cost rose considerably due to increased staff-related costs

Durrant Pate/Contributor

Net profit surged by a whopping 314 per cent at Jamaican listed lighting and energy company FosRich, jumping to J$158.9 million during the March 2022 quarter, up from the J$38.4million made during the comparable period in 2021.

This J$120.5-million increase is good news for shareholders who have already seen a massive jump in their earnings per stock unit, which is up to J$0.32 coming from J$0.08 for the comparative period in 2021, representing an increase of J$0.24 or 316 per cent. The company generated income for the first quarter of J$900.3 million compared to J$549.3 million for the prior reporting period.

Gross profit for the year-to-date amounted to J$371.3 million compared to J$191.7 million for 2021. FosRich reports that, “these increases were attributed primarily to increased sales in eight of our 11 product groups as follows: Control Devices, Industrial, LED, Lighting World, PVC, Solar, Wires and Wiring Devices”.

Administration expenses

Administration expenses is rising considerably with the year-to-date amount totaling J$195.2 million, reflecting an increase of $58.5 million on the prior reporting period figure of J$136.7 million. The changes were driven primarily by increased staff-related costs for salary adjustments, increased sales commission, due to improved sales performance and improvements in staff benefits.

This, in addition to increased occupancy cost due to the commencement of obligations for the company’s new Fulfillment Centre at 76 Molynes Road, along with increased electricity cost, increased legal and professional fees as well as higher depreciation, due to increases in the carrying values of property plant and equipment. On the positive side, there were reductions in motor vehicle expenses.

Finance cost year-to-date for the period under review was J$37.2 million compared to J$31.8 million for 2021, an increase of $5.4 million. This increase is being driven primarily by increases in bank financing.

Regarding inventories, FosRich continues to closely manage inventory balances and its supply-chain with a view to ensuring that inventory balances being carried are optimised, relative to the pace of sales, the time between the orders being made and when goods become available for sale. This is being done to avoid both overstocking and stock-outs.

Monitoring is done at both the individual product level and by product categories. Inventories have remained stable over both periods. FosRich reports that the run-off of inventories reflected in the first quarter is largely a function of the timing of new shipments.

Receivables being closely managed

The management has highlighted that receivables are being closely managed with an emphasis being placed on balances over 180 days.

According to the management, “we have implemented strategies to collect these funds as well as to ensure that the other buckets are managed. Seventy-two per cent of receivables are within the current to 60 day category, up from the 68 per cent for the prior reporting period“.

FosRich headquarters along Molynes Road in Kingston. (Photo:

Trade payables, which are categorised by foreign purchases, local purchases and other goods and services, is being concentrated primarily, on the foreign payables, as the bulk of our inventories are sourced from overseas. Non-current liabilities reflect a net increase of J$120.9 million, due to the booking of new motor vehicle and other bank loan facilities.

Shareholders’ Equity

Shareholders’ equity now stands at J$1.67 billion, up from the $1.01 billion at December 31, 2021. The increase of J$654.1 million arose as a result of property revaluation gains of J$$495.2 million and retained profits for the year-to-date amounting to J$$158.9 million.

Total shareholder count has increased to 2,054, up by 301 from the 1,753 at December 31.


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