OMNI “Potent” Turnaround in Q4 Earnings

• Aided by robust topline growth and lower finance cost, OMNI Industries Limited (OMNI) posted a 214.1% turnaround in net earnings to $28.19Mn for the quarter ended December 2025.
• Quarterly revenues climbed 49.9% year-over-year to J$615.54Mn, underpinned by the construction segment, which contributed 57% of total revenue amid a period of robust local infrastructure development. In addition to steady underlying demand, its performance was further bolstered by a tactical surge in domestic orders following Hurricane Melissa, as clients moved quickly to secure critical construction and storage assets.
• Cost of sales rose 45.9% to $373.67Mn as OMNI temporarily sourced certain raw materials from non-traditional suppliers to maintain production schedules and ensure product availability. Management noted that while this strategy resulted in higher input costs and higher direct costs, it effectively preserved operational continuity and enabled the company to meet customer commitments during a period of heightened logistical volatility. Importantly, revenue growth outpaced the rise in direct costs, resulting in a 167-basis-point expansion in gross margin to 39.3%.
• Operating expenses rose 21.7% year-over-year (up J$38Mn), largely driven by higher haulage costs and increased depreciation following the commissioning of new machinery. Despite the rise in spending, these expenses were necessary to support the company’s expanded operational capacity.
• In contrast, finance costs trended downward, falling 10% to J$11Mn in the corresponding quarter of the prior year, reflecting improved debt management and tighter control over financing costs.
• Looking ahead, the company is set to benefit from Jamaica's multi-year national reconstruction phase following Hurricane Melissa. OMNI is leveraging its newly upgraded injection-moulding capacity to meet the massive surge in demand for PVC pipes, Alu-zinc roofing, and electrical conduit items critical to the restoration of water and power by agencies like the NWC and JPS.
• Nevertheless, some headwinds remain, particularly in the form of global logistics disruptions and high input costs that could continue to squeeze operating margins. Even so, OMNI's strategic expansion into regional markets like Guyana and Barbados, combined with its role as a first responder in the local hardware supply chain, positions it for sustained volume growth.
• Omni’s stock has declined 0.3% year-to-date, closing at J$0.96 on Wednesday. At its current price, OMNI trades at a price-to-earnings (P/E) ratio of 14.1x, which is slightly below the Junior Market Distribution sector average of 14.5x.

(Sources: JSE & NCBCM Research)