The management of Lumber Depot Limited has indicated that it is aggressively seeking to increase its square footage for warehouse inventory, parking, and offloading deliveries.
In its annual report released on August 24, 2020, the company said, “Options to introduce an additional location are being explored along with further digital transformation to simplify and increase efficiencies in inventory maintenance, online purchasing, accounting, and general operations are part of our planned future strategies.”
The company’s management is banking on the growth of the construction sector in Jamaica. “New buildings continue to be constructed and renovations are being done for commercial and residential buildings. We, nonetheless, anticipate that as we go forward the growth and confidence in the construction industry will rebound, and possibly outpace previous years, all things being equal.”
In light of the growth of the construction sector, the company’s management said Lumber Depot will continue to “build market share through strategic purchases, increased sales, expanding our inventory options in keeping with market demand, paying particular attention to growing existing partnerships with developers by increasing our capacity to supply hardware items specific to the requirements of new construction projects.
“This will call for the further nurturing of the ‘from concept to finish’ relationships,” the report outlined.
The vast majority of customers at the Lumber Depot are small contractors or owners of homes and commercial buildings.
Lumber Depot Limited is a full-service, hardware and building materials company that has been in operation in the Jamaican building supplies sector since 1998.
Incorporated and domiciled in Jamaica on July 30, 2019, the company commenced operations over 20 years ago as a division of Blue Power Group Limited. However, in 2019 the company took over assets and liabilities from Blue Power Group Limited.
Management said that the central location of the retail office at the “exit of the city” allows the company to service the ongoing commercial developments in Kingston and communities in the rural St Andrew area.
Approximately 70 per cent of sales consist of cement, steel, lumber, and paints; the other 30 per cent comprise a large number of items including plumbing and electrical supplies.
“Options to introduce an additional location are being explored along with further digital transformation to simplify and increase efficiencies in inventory maintenance, online purchasing, accounting, and general operations are part of our planned future strategies.”
For the nine-month period, August 2019 to April 2020, revenues increased by three per cent despite a challenging fourth quarter with the onset of the COVID-19 virus, management said.
Profits prior to impairment losses on receivables and investments totalled JM$45 million.
After accounting for this impairment loss, net profit after tax for the nine-month period was JM$22.2 million.
Management noted that 2020 profits included a tax charge of JM$9.9 million on profits up to December 2019, when the company listed on the Junior Market of the Jamaica Stock Exchange.
Going forward, however, the company will not be liable for corporation tax for the next five years.
As of April 2020, the company had total assets of JM$374 million.
Lumber Depot’s management said that despite the challenges industry-wide due to the impact of COVID-19, the construction industry has continued to experience growth, and the company should benefit.