Durrant Pate/Contributor

Lighting and energy company FosRich has found itself in the red, delivering a sub-par performance for the March 2025 quarter.

The Cecil Foster-led company chalked up net losses of J$68.6 million, compared to J$33 million profit for the same period last year.  Earnings per stock unit are -1 cents compared to one cent in the prior year. The sub-par performance comes as FosRich announced that it has halted its plans to enter the United States market until further notice. 

Revenues were down to J$852.9 million, coming from J$859.8 million in the prior year. Gross profit contracted to J$305.6 million, down from J$389.5 million in 2024. Foster, in his forward to shareholders, commented, “Our current-quarter numbers continue to be affected by the substantial fall in PVC and solar panel cost on the world markets. What this meant for us is that despite achieving higher sales volumes, because our price reductions are passed on to our customers, we have achieved lower total sales income on these important lines of business.”

In addition, FosRich was affected by the slowness in housing starts locally, caused primarily by the considerable increase in interest rates in Jamaica in the current period compared to the prior period. The junior market-listed company is reporting that it has not yet begun to benefit from the recent reductions in interest rates. 

Manufacturing operations disrupted

According to Foster, “More importantly, the quarter was adversely affected by international problems in the shipping industry that continue to be affected by developments related to the operation of the Panama Canal. This resulted in significant delays in shipment for both finished goods and raw materials. Raw material delays significantly interrupted our manufacturing operation during the quarter, which limited our ability to keep the market supplied with these needed products.”

On the positive side, Foster advises that recent developments in the US market have seen FosRich’s global partners, in seeking to broaden and deepen their relationships with non-USA customers, have offered more favourable credit terms to the company. Foster reports that this should provide measurable benefits to FosRich going forward.

The company continues to implement the specific strategies as outlined within its strategic plan with a view to making the group more vertically integrated. However, despite the challenges ahead within the local operating space and the wider global space, FosRich is confident that it has the right talents and leadership to deliver on its plans for the ensuing period and will continue to execute its plans to ensure that the company remain competitive and delivers value solutions to customers.

In the meantime, construction of the new FosRich Superstore & Corporate Offices at 76 Molynes Road is advanced with completion date now projected to be Q3, 2025.

12% rise in admin expenses

Administration expenses for the review period amounted to J$337.4 million, reflecting a 12 per cent increase over the J$301.6 million booked in March 2024. The increased costs were fuelled primarily by a rise in staffing, increased travelling and motor vehicle expenses, and increased insurance costs due to increases both in policy renewal rates and exposure.

This, in addition to increased security costs due to additional locations and increased depreciation due to additional fixed assets. Finance cost closed on J$44.2 million, down from J$$55.7 million in 2025. Since the start of the year, there has been some run-off of inventories, primarily due to the shipping issues discussed above.

FosRich is proactively managing inventory balances and the 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 to avoid both overstocking and stock-outs. 

Monitoring is both at the individual product level and by product categories. The company continues to actively manage trade receivables with an emphasis being placed on balances in the over 180-day bucket. It has implemented strategies to collect these funds as well as to ensure that the other buckets are managed. 

FosRich has re-evaluated all credit relationships, and where necessary, credit limits have been reduced and credit periods shortened. For some inventory items, the company has instituted seven-day credit or cash. Sixty-four per cent of receivables are within the current to 60-day category, mirroring December 2024.