Fesco pouring $1b into expansion projects
Published:Wednesday | November 27, 2024 | 12:07 AM
Future Energy Source Company Limited, which trades as Fesco, has reaffirmed plans to add at least four new locations to its network in two years, amid investments in fuel distribution, LPG and allied commodities.
In its past financial year, ending March 2024, the company added three service stations in Kitson Town, St Catherine, Port Maria, St Mary and May Pen, Clarendon. Another was opened in Hayes, Clarendon in April.
Fesco has grown its network of stations by 50 per cent since going public via a listing on the stock market. It’s now the fourth largest petroleum marketing company, behind TotalEnergies, Texaco and Rubis.
“Our footprint is now at 21 service stations. At IPO, we were at 14. That makes seven stations in the last three years, and we’re really, really proud of that. Again, our footprint is relatively low compared to the majors, and as time goes by, we will add additional stations,” Fesco CEO Jeremy Barnes committed to shareholders at the company’s annual general meeting.
Regarding the expansion plans, the company expects to invest in excess of $1 billion for this current financial year, partly financed by the surpluses the company has been accumulating amid the outperformance of its profit targets.
“So, we’re able to use those retained earnings and make bigger investments and take bigger steps, which, we believe will pay off in the years to come,” Barnes told shareholders, in response to the concerns expressed regarding the lack of dividends.
One of the four new locations is already under development at Spanish Town Road in Kingston, called Fesco Oval.
The facility, which will be owned and operated by Future Energy, is 25 per cent complete, and is due for commissioning “around September 2025”.
The other three will be dealer-owned and operated.
As for its LPG business line, branded as Fesgas, Fesco is currently developing a filling station in Montego Bay, which will add a fifth plant to the existing filling stations at Naggo Head and Bernard Lodge in St Catherine, Stony Hill in St Andrew, and Discovery Bay in St Ann. The new facility is expected to be finalised by the end of 2024.