Fesco resets roll-out of new stations
Published:Wednesday | December 9, 2020 | 12:17 AMKarena Bennett/Business Reporter
Future Energy Source Company, which trades as Fesco, was expecting to have an additional six service stations operational across Jamaica by this time, but the petroleum marketing company has so far completed just the adjoining supermarket to the Fesco Service Station in Bodles, St Catherine, due to the intervention of the pandemic.
The new FYC supermarket is now the second service station-aligned grocery outlet. The chain of 14 gas stations also incorporates seven FYC Express convenience stores, through which Fesco distributes its branded FUTROIL and FUTRLUBE lines of motor oils and lubricants. The products are expected to account for around 15 per cent of company revenue by end-2021, according to Fesco Vice-Chairman and Operations Manager Hugh Coore.
Fesco’s next move is the addition of an FYC Mart, which will be a blend of the FYC Supermarket and FYC Express store concept, at the Fesco Ferry complex that is under development on the Mandela Highway in Kingston.
Fesco is expanding ahead of going public, but the timetable on that has also been muddied by the pandemic.
Partners in the petroleum marketing company, Lynden ‘Trevor’ Heaven, Hugh Coore, Errol McGaw, Junior Williams and Trevor Barnes, will this week meet to discuss whether to move ahead with the initial public offering of shares, IPO, which was initially planned for the fourth quarter of 2020, Coore said.
As for the Ferry project, the job site has been scaled down to 40 per cent of the work crew, but the Fesco partners are pushing to complete the project by March 2021. Fesco’s original plan, before COVID-19 derailed it, was to launch the IPO shortly after commissioning the Ferry complex, in which Fesco is investing $300 million, and to finalise development of the other outlets in order to grow the chain to 20 by end-2020.
“The Ferry project is about six months behind because of COVID-19 and the heavy rainfall that we had for the past two months – all of that has pushed back the timeline for opening,” Coore told the Financial Gleaner.
“Initially, the problems were with supplies, because most of the factories closed for the Chinese New Year and, in some cases, they were forced to remain closed until six months after. In fact, some of the materials that were scheduled to reach the island in June-July are just coming in now,” he said.
The complex is being built for Fesco by Landmark Developers Limited, which utilises both Chinese and local labourers for different aspects of its projects. Landmark is also expected to begin construction of Fesco’s new headquarters in Cross Roads, Kingston, come January, which is also expected to cost $300 million to develop.
“We’ve got all the approvals, but we haven’t started any physical work. We are just doing site preparation at the moment,” Coore said.
The service stations in the chain are operated under either a ‘dealer-owned, dealer-operated’ or ‘dealer-owned, company-invested’ or ‘dealer-owned, company-operated’ model. But the expansion will add a new component to the model – ‘company-owned, company-operated’.