SOS “Books” an Earnings Contraction for FY2025

  • Stationery and Office Supplies Limited’s (SOS’) audited earnings contracted by 40.5% to J$132.52Mn for the full year ended December 31, 2025, as rising cost of sales and higher administrative expenses outpaced revenue growth.
  • Revenues grew by 1.2% to $1.87Bn, reflecting increased exports. Management noted that revenues would have been significantly higher if not for Hurricane Melissa, which caused significant operational disruption in its 4th
  • Direct costs grew by 9.4%, but SOS lost its entire stock in its Montego Bay warehouse. With lower revenues and higher direct costs, gross profit fell 5.5% to J$952.79Mn and gross margin narrowed from 54.7% to 51.0%.
  • Operating expenses, which grew by 4.9% to $823.88Mn, also contributed to the lower profits. Administrative and general expenses rose 7.2% to J$612.49Mn, while selling and promotional costs were broadly flat at J$153.60Mn. Depreciation and amortisation added a further J$44.53Mn charge, and impairment losses on financial assets, while better than the prior year, still contributed a J$13.26Mn drag on earnings. Taken together, these operating costs weighed heavily on profitability, with operating profit declining sharply to J$136.82Mn from J$227.51Mn in the prior year, a fall of 39.3%.
  • Profit before tax of J$160.42Mn, was a significant reduction from J$246.63Mn in the prior year.
  • While Melissa closed its FY2025 on a tough note, there were some highlights. While there was no evidence of entering new markets in the Caribbean in 2025, SOS saw higher export sales in 2025, which implied that it sold more products in its existing destinations. The EVOLVE line of furniture continued to grow its revenues by 15% to $160Mn in 2025.
  • Lastly, the new SEEK factory was completed in late 2025. In the short term, this expansion should boost capacity, allowing the company to meet demand more efficiently and support improved profitability. Over the medium to long term, the added capacity positions the company to benefit from favourable industry trends; however, revenue growth is expected to remain moderate given the industry’s maturity and competitive landscape.
  • SOS's stock price decreased by 9.0% since the start of the year to close at $1.51 on Wednesday, March 18, 2026. At this current price, the company’s P/E sits at 25.2x, above the average of the JSE Junior Market Distribution Sector average of 19.7x.

(Sources: SOS Financial Statements & NCBCM Research)