Higher Revenues Bolster Increase in Stationery & Office Supplies’ Net Earnings

• Influenced by an increase in revenue, Stationary & Office Supplies’ net profit grew by 167.6% for H1 2021 to $58.43Mn (EPS: $0.23). 
• Revenues improved by 16.7% ($78.76Mn), which was more than sufficient to cover the 6.7% ($16.39Mn), 15.6% ($22.01Mn) and 13.5% ($5.11Mn) increases in direct costs, admin expenses and selling and promotional costs. 
• Managements believes this improvement in performance is a good indicator that Jamaica’s economy is continuing to rebound and expects that as it progresses through the summer months, it will see the return of children to school, which will also help improve the sales of SEEK back to school products in the market. That being said, the rise in COVID-19 cases in recent weeks could delay the reopening of schools and a further rebound in revenues. 
• SOS’s stock price has appreciated by 61.2% since the start of the year and closed Wednesday’s trading session at $7.32 per share. At this price, the stock trades at a P/E of 27.1x earnings, which is above the Junior Market distribution sector average of 21.4x.

Source: (SOS Financials)