Omni ‘Crates’ a Solid Performance in Q2

• Buoyed by robust sales volumes, Omni Industries saw its earnings rebound in the quarter ended June 30, 2025 (Q2 2025). Net profits totaled $51.75Mn, a 68.4% year-over-year increase.
• Revenues rose by 19.4% in Q2 2025 to $571.41Mn driven by sales volumes, particularly within the Company’s core construction-related product lines, which contributed 58% of total revenue.
• Cost of goods sold (COGS) also increased during the quarter, driven by a combination of external and operational factors. Global trade tensions, including the imposition of new U.S. tariffs on Chinese imports and heightened policy uncertainty, disrupted international supply chains and led to a rise in shipping cancellations. In response, OMNI temporarily sourced raw materials from non-traditional suppliers to maintain production continuity and fulfill customer commitments. While effective in safeguarding operations, this approach resulted in higher input costs, directly contributing to the 12.4% increase in COGS. However, the increase in cost of sales was outweighed by the pace of revenue growth, resulting in a 138bps improvement in gross margin to 35.9%.
• Similarly, operating expenses rose by a modest 4.0% to $171.92Mn, reflecting higher haulage costs and depreciation expenses associated with newly commissioned machinery. While these investments are expected to enhance future production capacity and product quality, the overall increase was partially offset by cost optimisation initiatives and ongoing efforts to improve internal efficiencies through automation.
• Despite the improvement in earnings during Q2, year-to-date earnings were down 23.7%, reflecting the impact of a weak first quarter during which earnings declined by 60.3%
• Omni Industries is executing a growth strategy focused on capital investment in production capacity, through machinery upgrades, and the expansion of its export footprint into key regional markets, including Nicaragua, Belize, and Barbados. Concurrently, the company is actively diversifying its supplier base to mitigate supply chain risk and reduce exposure to cost volatility. These initiatives are strategically aligned to enhance operational resilience, drive revenue growth, and deliver long-term value to shareholders.
• Despite the second quarter rebound, Omni’s stock price is down 28.4% since the start of the calendar year. The stock closed Thursday’s trading session at $0.78 and currently trades at a P/E of 20.5x above the Junior Market Manufacturing & Distribution Sector Average of 30.7x.

(Sources: JSE and NCBCM Research)