JFP Limited, which makes furniture for retail stores and hotels, said it is currently bidding on Hyatt hotel projects in the United States, as part of a wider effort to enter markets in the Americas. , as a new source of income.
It is also positioning itself for businesses of local hotel operators who would normally look to China for supplies, but are looking elsewhere as global supply chain issues remain unresolved.
The company, formerly known as Jamaica Fiberglass Products Limited, is looking to rebound sales which have been plagued by the COVID-19 pandemic. He also wants to set a new revenue inflow record in 2022.
“We’re doing quotes for the Hyatt in Jacksonville and the Hyatt in California,” JFP CEO Metry Seaga said Thursday during an investor briefing ahead of the company’s IPO on Monday aiming to raise $280 million. dollars to $1 per share.
The decline in revenue due to the pandemic is due to the delay of customer projects. The company’s “signed and sealed” pipeline of contracted projects stands at $255 million and will be paid to the company by the third quarter of its fiscal 2022. business, which Seaga said would also include walk-in orders and orders generated by its sales team.
“Based on the number of orders we already have, we expect to have our best ever sales year and that will translate into our best ever profit,” Seaga said.
In addition to targeting the United States and Central America for new business, JFP said it aims to supply furniture for up to 10% of the 7,000 new rooms that will be commissioned in the tourism sector. Jamaican over the next few years.
“We are confident that we can get some of this business,” he said.
The impact of the pandemic on the company’s sales and earnings is reflected in its most recent financial results for the nine-month period ending September 2021. JFP generated pre-tax profit of $5 million on sales of $210 million, compared to pre-tax profit of $87 million on sales of $312 million in the corresponding period of 2020. Additionally, its cash from operations lost $20.7 million compared to positive cash generation of $79.5 million in 2020; while its net cash position turned negative, ending the period at negative $15 million from holdings of $46.5 million the previous year.
In 2020 and part of 2021, one of JFP’s main sources of income has declined sharply with the virtual shutdown of the restaurant and hospitality sector. But since this year, JFP management said it has started receiving inquiries from hotels and other customers who would traditionally buy from China.
“[In China] their lead times and prices are so high that we see a niche developing. And we’re going to be there to fill that niche,” Seaga said.
He added that global delays in the supply of goods due to shipping and rising commodity prices have made the Caribbean more competitive with shipping from China. A container of goods from Kingston to Houston, Texas, in the United States, costs US$2,000 while that same container would cost US$25,000 shipping from China, he explained. Part of the saving comes from a Caribbean/U.S. trade duty waiver, which is hardly used by manufacturers in the region, he added.
In addition to the hotel industry, JFP is looking for new income in the catering and subcontracting sectors.
“The BPO sector is not a sector in which we are heavily involved, but it is a sector in which we work,” Seaga said. “It’s a tough nut to crack.”
JFP’s IPO will be on the market from February 21-28. The company goes public after nearly four decades in business, having started operations in 1985.
Of the $280 million, half of the funds will go to current shareholders Stephen Sirgany, Richard Sirgany and Metry Seaga, who are selling some of their holdings but together will continue to own 75% of JFP in equal blocks of 25 percent. cent, after the IPO.