Durrant Pate/Contributor

The slow-down in the local construction sector is hurting Lumber Depot, but the company has exhibited much resilience, resulting in relative profit growth of 11 per cent during the half-year ended October 2023.

Lumber Depot, which operates a full‐service hardware store in Papine, has over the course of the current financial year seen its customer base face uncertain economic conditions relatively high inflation, increasing interest rates and challenges with the availability of certain key hardware items. These conditions, the company explained, are now evidenced in a slow‐down of the Jamaican construction sector.

However, Lumber Depot has proven its resilience in keeping the business strong and highly competitive, despite the challenging economic circumstances.

Profitability and revenue out-turn

Lumber Depot generated net profits of J$86.7 million on revenues of J$782 million during the half-year performance.

Revenues were up marginally by one per cent, but, citing efficiency measures, the company delivered an 11 per cent profit growth.

Importantly, the business continues to be positively cash‐generative and earned cash from operations of over J$65 million, and now retains cash and investments in excess of J$300 million.

During the first half of the year, Lumber Depot improved its facility in Papine through investments in its buildings, yard space, financial control systems and operating equipment. The company noted that despite the current challenges, it has managed to maintain excellent service levels and customer endorsements.