Durrant Pate/Contributor

Stationery & Office Supplies (SOS) is reporting a marginal revenue gain despite what it noted was a noticeable slowdown in business activity ahead of the Parliamentary general elections in September.

During the June Q2 quarter, the office goods and furniture supplier saw revenues growing 3.5 per cent to J$448 million, up from J$433 million a year ago. For the half-year period, revenues rose by three per cent to J$985 million, up from J$958 million in 2024. 

However, higher costs and a slowing economy weighed on earnings, as pre-tax profit fell 51 per cent for the quarter under review to J$23.1 million and net profit closed on J$19.8 million, down from J$41.5 million in the same quarter last year. For the six-month period, pre-tax profit declined 32 per cent to J$106.7 million while net profit amounted to $93.4 million, down from J$137.1 million during the first half of 2024. 

This translated to earnings per share of $0.01 for the quarter and $0.04 for the half-year, compared to $0.02 and $0.06, respectively, in the prior-year periods.

Commenting on both the quarterly and half-year performances, SOS’s managing director, Allan McDaniel remarked, “Though the pre-election economic environment made for a challenging quarter, we still achieved year-over-year revenue growth in Q2. Profits for the quarter and the half-year thus far are lower than the previous year, but we are still in a strong financial position with growing revenues, increased equity, and a healthy cash base.”

He noted that SOS has invested strategically in its infrastructure, such as the new SEEK machinery, product range, and we’ve progressed with our regional expansion, which has already delivered measurable sales growth. These initiatives, McDaniel explained, are designed for long-term value, ensuring that even as margins face short-term pressure, which happens from time to time, the company is in the best position to capture future opportunities.

Positioned for growth amid economic pressures

SOS’s near-complete SEEK facility is expected to begin operations in the early Q3 and will enhance the company’s capacity to meet local and regional demand. Meanwhile, its EVOLVE office furniture line continues to perform well with four new chair models and additional furniture products added during the half-year. 

Regional sales by mid-year had already matched the total achieved in all of 2024, which McDaniel declared is an early impact of the company’s expansion strategy. Gross profit margins for both the quarter and half-year reflected pressure from higher shipping costs and the devaluation of the Jamaican dollar. 

The current inventory levels, valued at over US$2.2 million, will allow SOS to supply its dealer network without disruption. At the end of Q2, total assets rose 10 per cent year-on-year to J$2.04 billion while total equity increased by 12 per cent to J$1.65 billion. Cash and cash equivalents climbed 57 per cent to J$472 million, stemming from stronger collections and prudent cash management. 

These gains came alongside an eight per cent increase in fixed assets tied to the acquisition of two properties in late 2024, further strengthening the company’s operational base.