Business

FosRich's next big thing already in the making

BY BALFORD HENRY
Senior staff reporter
balfordh@jamaicaobserver.com

Wednesday, November 07, 2018

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Founder/Managing Director of lighting, electrical and solar energy products company FosRich Limited, Cecil Foster, is expecting much bigger achievements for his company in 2019.

Foster, who likes to boast that the company was started without even money and went on to receive more than $100 million in surplus applications from its initial public offering (IPO) of $200 million last December, says this promising new deal is even much bigger than that achievement.

But he is reluctant to give the details, except that it will move the company into a manufacturing mode, is exportable and will require FosRich's return to the market for more investment.

“We have four pillars, I can't speak to some right now because there is a gag on some of them, but we are very, very poignant about one of them and it is a significant move,” he told the crowd at last Wednesday's Mayberry Monthly Investor Forum at the Knutsford Court Hotel in New Kingston.

“We are going to be engaged in local manufacturing of a certain line of products that we know is used every day in Jamaica. And the fact is that we do this business in this line from outside Jamaica and we lose 30-35 per cent from not manufacturing it here. So, that alone is putting us in a spot where we can approach the market,” he stated.

“The market is roughly about $20 billion-$30 billion, and all we are trying to do in the first year and a half (2018/19) is to reach about three per cent of the market,” he pointed out.

“I can't tell you yet what it is. We are really just announcing this to you, but we can't tell you the details. But, it's going to put FosRich in a position to not too long from now be able to approach the Caribbean with some exports,” he went on.

“So, we are looking forward to the 2019 first quarter, when we will roll this thing out and we are looking to grow the numbers, so our shareholders and friends can feel comfortable about investing more and more in the company that is called FosRich,” he added.

Foster went on to explain that the product has a very huge market, including hotels and other buildings, and insisted that FosRich would be at the forefront of this market going forward.

Foster noted that the company started in a 12 feet x 12 feet space behind the Princeville Plaza in St Andrew, only 25 years ago.

“We started this business without money. Seriously, we didn't have any money, but I looked in a person's face, who was then my boss, and I told him that I wanted to leave the company I was employed as a salesperson and he didn't say, no.

“Well, I didn't leave it there. I said to him, 'I want you to allow me to stay on that route that I presently operate in and I am going to ask you to trust me the goods'. He said, 'I can't do that'. I said, 'listen I am committing that I will pay whatever it takes'. The argument went on for some time until he finally agreed.

“He said he would give me two weeks to pay. So, I went and stratified plans to enter the market: Went to a market that would pay quickly, so I could turn the money over and pay the debt. That kept happening, and he was amazed to see how much business he could derive from the same route with someone focusing on that route the way I was on it,” Foster explained.

FosRich's board of directors last report, which is for the nine-month period of 2018 ending at September 30, showed revenues of $945.9 million, or 19 per cent over the prior period; gross profit of $410.4 million, $50.2 million or 14 per cent over the prior period; and net profit of $71 million, up $48.4 million or 215 per cent over the prior period. Earning per stock rose to 14 cents, up eight cents or 152 per cent over the previous period.

The third quarter figures were also very encouraging, showing: revenues of $353 million, up $121.8 million or 53 per cent; gross profit of $141 million, up $34.9 million or 33 per cent; and net profit rising to $10.4 million, up $5.9 million or 135 per cent over the prior period.

In a statement published in the new unaudited financial statements, Foster noted that the latest quarter, the third since the company's listing on the Junior Market of the Jamaica Stock Exchange (JSE) on December 19, 2017, reflected the implementation of specific strategies outlined within its strategic plan.

“We are cognisant that despite the challenges ahead within this operating space, that we have the right talents and leadership to deliver on our plans for the ensuing period. We will continue to execute on our plans to ensure that we remain competitive and deliver value solutions to our customers,” he added.

So now the market awaits FosRich's next grand announcements, disclosure of the details of its next big project as well as the timing of its next IPO.

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