Durrant Pate/Contributor

Stationery and Office Supplies Limited (SOS) continues to see significant improvement in its financial performance, as the office supplies company surpasses the J$1 billion revenues mark at its half-year mark ended June 30, 2023.

For the June 2023 second quarter, SOS recorded a 25 per cent increase in revenue over the comparative period of 2022. With an increase in sales in all areas of business, revenues rose to an all-time high of J$525.2 million from J$420 million year-on-year while pre-tax profit rose 32 per cent from J$173.6 million to J$229.3 million.

SOS managing director, Allan McDaniel, commented, “this has been the company’s busiest quarter yet. We completed one of our largest individual projects in our history, installed a 200-seat call centre, shipped our first container of office furniture to the Apex Group in Cayman and our third to The Office Authority in Trinidad, commenced the expansion of our warehouse at Beechwood Avenue and doubled our warehousing capacity at our Montego Bay office. Overall, we’re very pleased with the results thus far and remain on track to achieving the company’s best financial year in 2023.”

Increased performance all ‘round

Among the contributors to revenue are the EVOLVE line, which doubled its revenues compared to a similar period of the previous year, and the Montego Bay location, which saw a 25 per cent revenue increase for the first half of the year from J$113.2 million to J$141 million.

Gross profit percentage rose from 51 to 53 per cent with the continued reduction in the input costs of the various products and improved sourcing of material and parts used in manufacturing of the SEEK products. SEEK experienced a 29 per cent increase in sales year-on-year with the increased availability of its books within the Jamaican market. Its performance is set to improve even further with a number of new dealers interested and inventory being sufficient to meet the market.

With the increase in revenues, gross profit percentage and a marginal increase in expenses, SOS’s pre-tax profit rose substantially by 77 per cent from J$68.8 million to J$121.3 million, the highest in the company’s history. Pre-tax profit for the half-year rose 32 per cent moving from J$173.7 million to J$229.3 million.

At the end of the second quarter, SOS increased its total assets year-on-year by 42 per cent increasing from J$980 million to J$1.38 billion, the bulk of which was due to SOS’s revaluation of four of its properties in the Kingston 5 area. Total current assets also rose led by inventory increasing significantly by 23 per cent to J$350 million and bank and cash rising by 151 per cent, to J$304 million.

“SOS continues to grow both physically and financially. We’ve been consistently adjusted our strategies to meet the needs of the ever-changing market and this is the main reason we’ve continued to be profitable even in an unpredictable and unstable economy,” McDaniel said.

Surpassing previous milestones

The offices and furniture supplies company has been on a winning streak since rebounding from the 2020 financial setback caused by the COVID-19 pandemic. Bouncing back from the tough financial year, in 2021, SOS earned J$1.1 billion in revenues, representing a 16 per cent increase on the previous year.

Then, the 2022 financial year saw SOS earning J$1.7 billion in revenue, reaching J$427 million by the first quarter and J$847 million at the half-year mark. Compared to the current financial year, the company has earned J$519 million in revenue in the first quarter – a 22 per cent increase – and has surpassed J$1 billion by the half-year mark, a 23 per cent increase.

June 2023 presented SOS’ highest revenues realised in a month at J$209.5 million and the highest Pre-tax profit in a month at J$51.5 million. As expected, SOS’ persistent growth has been beneficial to its shareholders.

Earnings per share at the end of the second quarter was J$0.79, an increase of J$0.09 compared to J$0.70 at the second quarter of the previous year. Further, on June 1, 2023, SOS declared a dividend of J$0.20 per ordinary share payable on July 10 to shareholders on record as of June 23, 2023.

Meanwhile, on July 25, shareholders unanimously approved the company’s momentous 9:1 stock split, which saw them receiving nine additional shares for each they currently hold.