SOS reports challenging Q2 as revenues dip 17% 

Stationery and Office Supplies Limited (SOS) reported a challenging second quarter of 2024, with revenues decreasing by 17 per cent to $433 million compared to $525 million in the same period last year.The performance “was not good” according to management in its financials.

The decline in revenue is primarily attributed to significant increases in shipping costs, which saw rates rise by as much as 200 per cent, driven by high demand and a shortage of containers from the Far East. This led some customers to delay projects, hoping for a reduction in prices.

The company faced increased administrative expenses due to the hiring of additional staff and salary increases, aimed at maintaining high service standards and supporting its commitment to 24 to 48 hour delivery service. These investments in human resources are seen as critical to the company's long-term success and operational efficiency.

To this end, net profit for the second quarter was $41.5 million from $105 million a year before.

SOS continued its export growth by shipping another container to Trinidad and embarking on new projects. Additionally, the company started constructing a new 9,000-square-foot warehouse at 26 Collin Green Avenue, which will accommodate increased inventory and new SEEK machinery set to arrive in the 3rd quarter of 2024.

One of the standout performers for SOS is its SEEK division, which continues to thrive despite the challenges. The company anticipates that new machinery will further enhance production capacity to meet the strong demand for SEEK products.

SOS's financial results show a drop in operating profit to $44.6 million from $119.6 million in the previous year, reflecting the impact of higher expenses and reduced revenues. However, the company's focus on service improvements and infrastructure expansion positions it for future growth.