OMNI Industries See Lower Bottom Line for the Full Year Ended 2024

• For the 12 months ended December 31, 2024, OMNI Industries recorded a 20.30% decline in net profit, primarily due to lower year-over-year revenues and increased operating expenses.
• The falloff in revenues was due to adverse weather conditions from June to December 2024 and a cement shortage, both of which negatively impacted the construction industry and by extension, OMNI’s topline performance compared to 2023. The broader economic environment also remained sluggish, with negative growth recorded over the past few quarters, which also contributed to lower demand in its revenue lines.
• A faster decline in input costs relative to revenues caused gross profit to increase by 9.22% to J$871.54Mn. However, this improvement was overshadowed by a sharp rise in operating expenses, which grew by 24.39% to J$703.35Mn. Selling expenses rose 57.71% year-over-year to J$160.82Mn, driven by higher haulage and export-related costs.
• Factory expenses also increased by 19.00% to J$234.78Mn, mainly due to higher repair and maintenance costs, along with depreciation expenses related to new equipment commissioned in the fourth quarter. As a result, operating profit declined by 24.95% to J$175.87Mn for the period.
• The increase in operating expenses, combined with declining topline performance, outweighed reductions in both cost of sales and net finance costs, resulting in a 20.30% drop in net profit, which closed at J$120.27Mn.
• As part of its strategic retooling initiative, OMNI is acquiring new equipment aimed at driving cost efficiencies and reducing expenses in the short term while optimizing operational performance moving forward.
• OMNI’s stock price has fallen 0.92% since the beginning of the calendar year. The stock closed Thursday’s trading session at J$1.08 and currently trades at a P/E ratio of 22.45x, above the Junior Market Distribution Sector Average of 21.77x.

(Sources: OMNI Industries Limited & NCBCM Research)