• FOS exports 6% of sales to US, facing 10% tariff
• FOS products not price sensitive, competitors facing higher tariffs
• Australian government trade policies could benefit FOS exports

FOS Capital Limited (ASX: FOS) notes the recent announcement of a 10% tariff on most Australian-originating goods sold into the United States. FOS export sales to the US in 2024 were A$2m, equivalent to 6% of total sales. The products that FOS exports to the US are specification-grade, favoured by engineers and architects for their quality and high performance, and are not generally price sensitive. FOS believes its US-exposed business is a net beneficiary of the 10% tariff as its respective competitors are all importers into the US and are facing equivalent or higher tariffs, including a 20% tariff for the EU, 10% for the UK, and 26% for India. There is no US-based manufacturer of substance for the products that FOS exports to the US. FOS also notes that efforts to promote the buying of Australian-made goods have a positive read-through as FOS is one of a small number of lighting companies that manufacture in Australia. Additionally, a proposed $1bn export loan facility to assist Australian export-focused companies could facilitate the acceleration of FOS' more nascent export markets, namely Italy, the UK, and UAE. The proposal to provide $50m to various industry peak bodies to support affected sectors is unlikely to directly benefit FOS. A more tangible action to support local manufacturers would be reducing or removing payroll tax.