FOSRICH Company Limited has reported strong growth in the six months to the end of June and has already indicated to shareholders that more growth is to come with the recent start of operations at its associated company, Blue Emerald.
The FosRich-associated company which operates with a special economic zone designation from its base in Hayes, Clarendon, started operations recently after getting approval to operate in early July.
"Blue Emerald is now just going to be kicking off, because under the licence, we couldn't be in operation before getting approval. We instead spent the time doing training and brought in the equipment and did some test runs. As we speak now, we are going full force in trying to move that business forward, so Blue Emerald is expected to show up strongly in the third and fourth quarters," Cecil Foster, managing director of FosRich, told the Jamaica Observer.
Foster was speaking against the background of his company's six-month financials which showed net profit grew 160 per cent to $298 million. Revenues on the other hand reached a record $1.8 billion for the half-year.
"The drivers of the growth came from the PVC [polyvinyl chloride] business, the solar business, LED and the copper part of the business. Those were the four significant areas of growth," Foster added in an interview with the Business Observer.
"During the period we supplied a shipment of LED streetlights to the Jamaica Public Service (JPS) Company. That made LED [sales] increase by a pretty good number for the period," he said, without expounding on what that number was.
FosRich has been contracted by the JPS along with a Canadian firm to supply the LED lights for the more than 110,000 streetlights it has been changing across the island over the last few years. Close to 75 per cent of the project is complete so far, he noted. "We are expected to be in the game for the next 25 per cent."
"Right now we are in the ball park of doing some projects outside of JPS. The JPS portion of LED was 18 per cent of LED sales for the period for FosRich."
"We are always looking at other projects and some of them we can't talk about yet. A lot of infrastructure is being put into a lot of housing developments across the country and we are positioning ourselves to supply them with cutting-edge LED lights from Philips."
He continued: "PVC exports are getting stronger."
The company currently exports to Barbados.
"We have shipments that are flowing out more frequently now, including another shipment which is set to go out next week. At the same time, the PVC market in Jamaica is still very much under-supplied by us, and so we are seeing growth consistently for the last six months in the PVC sales."
The company currently exports 2 per cent of its PVC pipes, solely to Barbados, but is looking to tie up other deals to expand its geographic reach.
"The export market is growing and we expect that to continue growing to a sizeable number," he said optimistically. "Ships are sent with PVC in intervals of under two months. We are growing the business with the export market and we are looking to other markets outside of Barbados, such as the North American market, and so on."
Foster told the Business Observer that his PVC business has recorded growth since he started to produce the items.
"Of note, it is continuing to grow even though we have not put one of our sewer industrial pipes out to the market as yet."
The company currently produces PVC pipes for electrical use, water pipes and drain pipes. Foster said he expects sewer pipe sales will start by the end of August.
He added that the increase recorded in the sale of copper pipes was "due mainly to an increase in prices and not necessarily increased volumes. We also now see where solar is taking off with the Huawei partnership finding its footing in the market".
He concluded telling the Business Observer that he is on the look-out for acquisitions though he declined to say if talks are advanced with any potential target.