Durrant Pate/Contributor

Jamaica’s toll road operator, TransJamaican Highway (TJH) Limited is seeing a surge in net profit for the just-ended September quarter, as the hike in toll rates kicks in.

The annual increase in toll tariff, which took effect in July is reaping benefits for the company, evidenced by its latest financial returns for the September quarter and combined nine-month period ended September 30, 2022.

Pre-tax profit for the September quarter went up five-fold to US$2.8 million, an increase of US$2.3 million over the US$0.5 million recorded for the same quarter in 2021.

This increase in profitability mainly resulted from the increased revenue, slightly lower finance cost and was offset by increased operating and administrative expenses. Profit before tax for the nine-month period went up by more than 300 per cent to US$5.8 million compared to US$1.8 million for the same period in 2021.

For the nine-month period ended September 30, 2022, net profit more than doubled to US$4.1 million, reflecting an increase of US$2.3 million, when compared to profit of US$1.8 million for the same period in 2021.

Toll hike drove up revenues

For the September quarter, TJH booked revenues of US$16.7million, reflecting a 28 per cent increase of US$3.6 million, compared to revenue of US$13.1 million for the same period in 2021. This was attributable to the July hike in toll rates and the continued improvement in toll traffic following the lifting of the measures implemented to combat the spread of the COVID-19.

Revenue for the nine-month period came out at US$47 million, up from US$37.5 million for the same period in 2021, an increase of 25 per cent. In addition to toll income, TJH recorded other gains of US$0.1million, reflecting an increase of US$0.05 million compared to US$0.05 million for the same period in 2021.

This was primarily due to secondary income earned during the quarter. Operating expenses for the combined three quarters amounted to US$29.1 million compared to US$25 million in 2021 and were impacted by increases associated with new marketing campaign and legal & professional fees in addition to spares and equipment purchased to improve the services offered in the Tag lanes.

Administrative expenses

TJH incurred administrative expenses for the quarter of US$0.4 million, reflecting an increase of US$0.2 million, compared to US$0.2 million for the same quarter in 2021. This increase was primarily due to increases in staff cost relating to a job reclassification exercise and resumption of training and other staff initiatives following the lifting of the COVID-19-related measures.

There was also an increase in consultancy fees. For the nine-month period administrative expenses went up to US$1 million, reflecting an increase of US$0.2 million, compared to US$0.8 million booked in 2021.

For the quarter finance costs totaled US$3.7 million compared to US$3.8 million last year. For the nine-month finance costs were down to US$11.2 million from US$11.5 million This reduction is in keeping with lower interest payments for the secured notes since principal is being repaid on a quarterly basis.

 As at September 30, 2022, liabilities stood at US$257.9 million, reflecting an increase of US$2.8 million, compared to US$255.1 million as at December 31, 2021. This was primarily due to the interim dividend of US$7 million, declared on September 30, 2022 and was offset by principal repayment made on the secured notes during the year.