August 30, 2023

Stationery and Office Supplies Limited (SOS) for the six months ended June 30, 2023, reported a 23% increase in revenue totalling $1.04 billion compared to $847.70 million in the corresponding period last year. Revenue for the second quarter had a 25% increase to close at $525.23 million compared to $420.08 million for the comparable quarter of 2022.

Cost of sales amounted to $486.50 million (2022: $416.21 million), this represents an increase of 17% year over year. Consequently, gross profit increased by 29% to $557.92 million compared to $431.49 million for the six months. The company booked gross profit of $287.46 million for the second quarter versus $213.69 million reported for the similar quarter of 2022.

Administrative and general expenses increased by 19% to close at $240.03 million (2022: $202.17 million). Selling and promotional costs increased by 13% from $60.56 million in 2022 to $68.29 million in the period under review. Depreciation, amortisation and impairment amounted to $18.01 million, a 2% increase relative to $17.70 million reported in 2022.

Operating profit for the six months ended June 30, 2023, amounted to $231.25 million, a 53% increase relative to $151.33 million reported in 2022. Operating profit for the second quarter amounted to $119.56 million (2022: $67.16 million). Finance costs totalled $3.55 million, a 22% decrease from the corresponding period last year (2022: $4.55 million).

Profit before tax for the six months ended June 30, 2023, amounted to $229.34 million, a 32% increase relative to $173.67 million reported in 2022. Profit before tax for the second quarter amounted to $118.97 million (2022: $68.78 million).

Gain on foreign exchange for the six months ended June 30, 2023, had a 859% increase to reach $489,747 (2022: loss of $64,490). There was no profit/loss on disposal of property plant and equipment for the six months amounted (2022: profit of $26.95 million). Similarly, there was no profit/loss on disposal of property plant and equipment for the second quarter (2022: profit of $3.58 million).

Income tax expenses amounted to $30.25 million (2022: nil). Income tax expenses for the quarter totalled $14 million (2022: nil).

Profit for the period totalled $199.09 million, relative to the $173.67 million reported twelve months prior. For the quarter, profit amounted to $104.97 million compared to the $68.78 million reported in 2022.

Consequently, earnings per share (EPS) for the six months amounted to $0.09 (2022: $0.08), while EPS for the quarter totalled $0.05 (2022: $0.03). The twelve-month trailing EPS was $0.13, and the number of shares used in these calculations was 2,251,084,500.

Notably, SOS’s stock price closed the trading period on August 30, 2023, at a price of $1.81 with a corresponding P/E ratio of 14.45x.

Balance Sheet Highlights

The company’s assets increased by 50% to $1.63 billion (2022: $1.09 billion). This increase was largely due to property, plant and equipment, which grew 68% from $390.89 million in 2022 to $654.96 million in 2023.

Shareholder’s equity was $1.30 billion (2022: $850.50 million), representing a book value per share of $0.58 (2022: $0.38).

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