Evolve furniture line rakes in $12 million in average monthly sales

Durrant Pate/Contributor

Stationery and Office Supplies Limited (SOS) is on track to achieving its second-highest annual revenue and pre-tax profit this year, driven by notable growth in its signature Evolve furniture line and strategic expansion investments.

In its unaudited financial results for the third quarter and nine months ended September 30, 2024, the company reported solid financial stability with total assets at $1.9 billion year-to-date, driven by increases in cash and property assets, positioning it for a strong year-end finish.

However, revenue for the quarter contracted by 8% compared to 2023. Expenses rose equally by 8%, driven by staffing increases, revised salary structures, and compliance costs related to Jamaica’s Data Protection Act, which required more staff and training. 

Operating costs spiked owing to the impact of longer shipping times and costs and fewer government projects. However, the company’s gross profit percentage improved by 2%, as it maximized procurement efficiencies and secured favourable terms with suppliers.

Evolve line continues to do well

The standout achievement in the quarter is the impressive performance of the Evolve line, which saw a 35% increase in sales compared to the same period in 2023. “We’ve seen strong demand for the Evolve line, which continues to exceed expectations month after month,” declared SOS Managing Director, Allan McDaniel noting, “It’s rewarding to see our investment in this product line resonate so well with the market.” 

Launched in 2022, the line of modern office furniture includes free-standing desks, cupboards, chairs, tables, podiums, reception furniture, and credenzas. To support its growth, SOS has made substantial inventory increases and expanded the variety within the line, ensuring greater product availability for clients.

Expansion and Export

Beyond product demand, SOS is moving forward with structural expansions that underscore its growth ambitions. The company recently broke ground on a new 8,500-square-foot warehouse at 26 Collins Green Avenue, which is set to house new products and accommodate its expanding manufacturing needs. 

The facility will also support the company’s broader vision of launching additional offerings, backed by increased stock levels and its new $50 million SEEK machinery. According to McDaniel, “While the new warehouse is about adding space where needed, it’s also about laying a foundation for more growth. It will allow us to meet client and customer demands more efficiently and keep pace with the market.”

SOS’ product demand continues to grow and exports have become a significant contributor to this factor. The company’s unaudited financial results note that two additional containers were shipped during the quarter, bringing the total for the year to eight. 

The Evolve line remains a top choice for international distributors, marking it as a key revenue stream beyond the Jamaican market. The company’s export strategy focuses on quality and dependable delivery and ultimately strengthens its foothold in the regional market.

Challenges with rising expenses

While SOS faced challenges during the year-to-date impacting its revenues coupled with a rise in expenses, McDaniel pointed out that this has been unavoidable. There has been a 15% rise in year-to-date expenses, attributed to workforce expansion and compliance with Jamaica’s Data Privacy Act, which required new hires and additional training. 

SOS’s asset position reflects prudent financial management with total assets growing 13% year-on-year to reach $1.9 billion. The increase was largely driven by a significant rise in cash and cash equivalents, as well as property and equipment assets. 

Another standout accomplishment for the company for the year thus far was reducing outstanding receivables by half, from $317 million to $160 million, which strengthened cash flow and facilitated a threefold increase in finance income over last year.