Black Immigrant Daily News
Stationery and Office Supplies Limited (SOS) is considering an Additional Public Offering (APO) in its 2023 financial year and is mulling several expansion plans.
The company made the revelations at its Annual General Meeting (AGM) held on Tuesday.
Responding to a shareholder regarding expanding the authorised share amount, managing director Allan McDaniel said the directors of the company have been considering the matter for some time now.
“We have that on the table right now. We have discussed the pros and cons of it [and] it is something that we are definitely leaning towards right now,” he said adding that any decision taken on the matter will be in the best interest of the company and its shareholders.
He, however, did not give a timeframe for the APO saying only that: “We believe that will be an end result at some point in time and if it’s in 2023. We are still working toward that goal…”
Of its expansion plans, McDaniel said several avenues are being pursued.
“We have looked at several markets outside of Jamaica to continue our expansion as well as within Jamaica [and] we believe there is an abundance of work that we can do here to get more market share…” he said.
The company is also in discussions “with different organisations in various islands” about continuing distributions of its various products, he said.
Stationery and Office Supplies Ltd.’s Managing Director, Allan McDaniel
SOS Limited has also forged a partnership with an American office supply provider – AIS Incorporation – and has seen much “interest” from the market.
“So, we expect this relationship to deliver results in 2022,” Board Chairman, Stephen Todd told the meeting.
In addition, the company is mulling expansion of its warehousing capacity in Montego Bay as well as expanding its Beechwood Avenue location “as well as looking at other locations for expansion,” the managing director said.
SOS produced its highest revenues in the company’s 57-year history during the 2022 July to September quarter. Revenues for the period stood at $473 million, surpassing the previous high set in Q1 by $46 million, an 11 per cent increase.
Pre-tax profits stood at $87.2 million, a 345 per cent increase.
“Key drivers include soaring sales from the Montego Bay branch as the economy sprang back to life with the reopening of the tourism sector and the launch of several new call centres. For the quarter, sales through the North Coast outlet increased to $60 million from $33 million in 2021,” the company said in its media release.
Detailing the company’s strategic plans that guided its safe navigation of the pandemic, Todd said the decision to increase inventory by 30 per cent resulted in increased revenues for 2021, buoyed by sales from many other local firms that were forced to buy local due to disruptions in the global supply chain.
Facing a 400 per cent increase in shipping rates during the pandemic, Todd said the company’s response of looking for opportunities in turbidity saw it coming out virtually unscathed.
“Early in the year, we focused on containing cost and made several adjustments such as maintaining higher inventory levels to counter the impact of the worldwide shipping backlog. We targeted hybrid workspaces and increased our stock of work-from-home furniture that was in high demand as well as industrial racking and ergonomic leg, back and neck support,” Todd said.
“This strategic plan to ramp up manufacturing and ordering paid off. We protected the business from increases in production cost and we were able to operate as per normal,” he said.
By growing its corporate segment “significantly,” the company was also able to “plug the gap caused by the lower demand from the education sector due to virtual learning at the time,” Todd said.
SOS Limited has also developed a new line of furniture “to satisfy new customer segments.”
“The initial research is extremely promising and we are partnering with a new factory on the production,” the board chairman outlined.
For the 2021 financial year, the company’s stock price grew by 43 per cent, starting the year at $4.46 to close at $6.39.
For the 2021 financial year, SOS Limited saw a 16 per cent increase in revenues, up from $972 Million to $1.1 billion.
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