Increased sales in 11 of its 12 product groups

Durrant Pate/Contributor

Jamaican lighting and energy company, FosRich Limited is shining brightly, delivering strong year-to-date performance with profitability surging by 116 per cent.

For the combined three quarters ending September 30, 2022, FosRich chalked up net profits of J$388 million, up $209 million or 116 per cent from J$179 million booked for the same period last year. Net profit for the September quarter came out at J$90 million, up $25 million or 39 per cent, from J$65 million in 2021.

For the nine-month period, earnings per stock unit (adjusted for stock split) is 7.7 cents, compared to 3.6 cents in the prior period, an increase of 114 per cent, while for the September quarter, this came out to 1.8 cents, compared to 1.3 cents in the prior period, an increase of 38 per cent.

Year-to-date income is up J$892 million or 53 per cent to J$2.57 billion compared to $1.68 billion for the prior reporting period. The rise in income is attributed to increased sales in 11 of the company’s 12 product groups with panels being the only product group that registered a decrease over the period.

During the third quarter, the company generated income of J$779 million compared to J$593 million for the prior reporting period, representing an increase of J$186 million.

Sharp rise in admin expenses

Administrative expense for year-to-date saw a sharp rise to J$612 million, reflecting an increase of J$165 million over the J$447 million reported for the corresponding period last year. The higher admin expense cost was driven primarily by increased staff-related costs for salary adjustments, increased sales commission, due to improved sales performance and improvements in staff benefits.

In addition, there was increased occupancy cost due to the commencement of obligations for the company’s new Fulfilment Centre at 76 Molynes Road and disposal losses related to the early termination of the old 76 Molynes Road lease as well as increased selling and marketing costs. FosRich also had increased computer expenses; increased local travel and petrol costs; higher electricity cost; higher legal and professional fees; increased depreciation due to increases in the carrying values of property plant and equipment and increased security expense.

There was also higher finance cost for the year-to-date totaling J$127 million compared to $111 million in 2021, an increase of $16 million. Shareholders’ equity stands at J$1.90 billion, up from the $1.01 billion as at December 31, 2021.

The increase of J$891 million arose primarily as a result of property revaluation gains of J$495 million and retained profits for the year-to-date amounting to J$388 million.

Blue Emerald associated company

FosRich’s Blue Emerald associated company has now received a licence from The Special Economic Zone Authority. This will allow Blue Emerald Limited to take advantage of the significant long-term tax concessions that are available as a Special Economic Zone-designated company.

Activities being undertaken at FosRich’s new Hayes facility in Clarendon will be done through Blue Emerald, which will be acting exclusively for FosRich under a contract manufacturing arrangement.