OT Equity Analysis | Mailpac posts record J$2.98B Revenue as margin expansion steals the story

Prepared for Our Today | Capital Markets & Investments Desk May 28 2026

Net profit rises 21% to J$301 million for the year ended December 2025, but the more compelling number is a gross margin that has expanded by more than six percentage points in a single year.

Mailpac Group Limited has released its unaudited financial statements for the twelve months ended December 31, 2025, and the results confirm what the company’s trajectory over the past two years has been pointing toward: a logistics and e-commerce platform that is getting structurally more profitable as it scales, not merely larger.

Revenue for the full year reached J$2.98 billion, a 16.4% increase over the J$2.56 billion recorded in 2024. That is a respectable top-line number for a Junior Market company. The more instructive figure, however, sits one line below it. Gross profit grew 30.9% to J$1.64 billion, on cost of sales that rose by only 2.5%. When a company grows revenue by 16% while keeping direct costs nearly flat, the result is margin expansion. Mailpac’s gross margin widened from 48.8% in 2024 to 54.9% in 2025, a six-percentage-point improvement that speaks to something more durable than a good quarter.

Full-Year Performance

MetricFY 2025 (J$)FY 2024 (J$)ChangeRevenue2,983,587,0752,563,861,672+16.4%Cost of Sales1,344,374,7021,311,561,953+2.5%Gross Profit1,639,212,3731,252,299,719+30.9%Gross Margin54.9%48.8%+6.1ppOperating Expenses1,102,722,563878,504,598+25.5%Operating Profit536,489,810373,795,121+43.5%Finance Costs184,699,087115,937,489+59.3%Net Profit301,152,635248,777,241+21.0%EPS$0.12$0.10+20.0%

The driver of that margin improvement is not difficult to identify. Mailpac completed the acquisition of My Cart Quick Limited in April 2024, which brought online grocery shopping and household supply delivery into the group’s service mix. The integration of MyCart has evidently improved the company’s revenue composition, generating higher-margin sales from the e-commerce channel without a proportional increase in direct cost. The MyCart platform now sits alongside Mailpac’s established international courier and mail-order operations as a second engine of growth.

Operating profit climbed 43.5% to J$536.5 million, producing an operating margin of approximately 18.0%, up from 14.6% in the prior year. Operating expenses rose 25.5% to J$1.10 billion, reflecting the cost of running a larger retail network and the MyCart platform, but gross profit growth of 30.9% comfortably absorbed that increase and still delivered improved profitability at the operating level.

Gross profit grew 30.9% on cost of sales that rose just 2.5%. That divergence is the most important number in Mailpac’s 2025 results.

Finance costs increased more sharply, rising 59.3% to J$184.7 million. The bulk of this increase flows from the company’s expanded retail footprint and the associated lease liabilities recognised under IFRS 16, rather than from bank borrowings. Interest expense on right-of-use assets nearly doubled year on year. This is the accounting consequence of physical expansion and is worth distinguishing from the kind of balance sheet leverage that creates repayment risk. The former reflects investment; the latter reflects dependence.

Profit before taxation reached J$354.1 million, up 36.7%. The net profit figure of J$301.2 million, representing a 21.0% increase over 2024, understates the underlying operational improvement because of a material change in the tax position. Mailpac transitioned to the 50% income tax remission phase under the Jamaica Stock Exchange Junior Market rules on December 4, 2024, having previously benefited from full 100% remission. The taxation charge for 2025 was J$53.0 million, compared to a tax credit of J$10.3 million in the prior year. Adjusting for that shift, the improvement in pre-tax profit of 36.7% is the cleaner measure of operating progress.

Earnings per share rose to J$0.12 from J$0.10, based on 2.5 billion weighted average shares outstanding. The Board of Directors declared total dividends of J$0.09 per share for the financial year, comprising J$0.03 per share paid in July 2025 and J$0.06 per share payable in January 2026.

Hurricane Melissa and the Fourth Quarter

The final quarter of the year told a more complicated story. Revenue for the three months ended December 31, 2025 fell 1.5% to J$827.2 million from J$839.4 million in the corresponding quarter of 2024. Executive Chairman Khary Robinson attributed the shortfall directly to Hurricane Melissa, which struck Jamaica in October 2025 and caused damage estimated at 40% of GDP. Nine of Mailpac’s retail locations were affected with varying degrees of severity during what is ordinarily the company’s peak trading season.

MetricQ4 2025 (J$)Q4 2024 (J$)ChangeRevenue827,208,550839,419,777-1.5%Cost of Sales384,996,971416,074,054-7.5%Gross Profit442,211,579423,345,723+4.5%Operating Profit133,882,434120,109,325+11.5%Net Profit52,998,34470,483,801-24.8%EPS$0.02$0.03-33.3%

Despite the revenue pressure, Q4 gross profit improved to J$442.2 million, producing a gross margin of 53.5% against 50.4% in Q4 2024. Operating profit rose 11.5% to J$133.9 million. Net profit for the quarter was J$53.0 million, down 24.8% from J$70.5 million, with the decline driven primarily by the higher tax charge following the remission transition and the hurricane-related disruptions to high-margin peak-period volumes.

The resilience evident in the gross margin and operating profit lines during a quarter when nine stores were operationally disrupted is a reasonable indicator of how the business performs when conditions are normal. Normalisation of operations toward the end of the quarter, as confirmed by Robinson’s shareholder letter, suggests the damage was temporary rather than structural.

Balance Sheet and Liquidity

Mailpac closed the year with cash and cash equivalents of J$362.4 million, reflecting a net increase of J$109.1 million after accounting for all cash flows and foreign exchange movements. That cash generation, in a year that included physical expansion, an integration exercise, and a hurricane, provides the group with the financial flexibility to continue investing in its network without recourse to external funding in the near term.

Total dividends of J$0.09 per share represent a meaningful return to shareholders relative to the current share price, and the board’s willingness to declare dividends in a hurricane year signals confidence in the underlying cash-generative capacity of the business.

The Filing Delay

One item worth noting for investors is that Mailpac has advised the Jamaica Stock Exchange that the publication of the audited financial statements for the year ended December 31, 2025 and the unaudited statements for the quarter ended March 31, 2026, will be further delayed. The company has not specified the reason, though audits of businesses that have undergone acquisition-related integration and hurricane disruption within the same financial year can reasonably involve additional complexity and time. Investors should monitor the JSE for the updated filing date.

What the Results Say

The headline numbers for Mailpac’s 2025 year are strong: record revenue, record gross profit, 43.5% growth in operating profit, and dividends that were increased despite the hurricane. But the more important signal is structural. A business that grows revenue by 16% while holding direct cost growth to 2.5% is demonstrating operating leverage of the kind that compounds over time. The gross margin of 54.9% is not the ceiling; it is the base from which the next phase of the company’s growth will be measured.

The Junior Market listing has served Mailpac well as a capital-raising and profile-building vehicle, but the 50% tax remission phase that the company entered in late 2024 means the full tax rate is approaching. Investors should factor that into forward earnings expectations. The operational trajectory, however, remains intact.

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This commentary is prepared for informational and editorial purposes only and does not constitute investment advice. Readers should conduct their own due diligence and consult a licensed financial adviser before making any investment decisions.