Having suffered heavy losses due to the negative effects of COVID-19 resulting in a downturn in toll revenues, Trans Jamaican Highway Limited (TJH), is reporting net profits of US$1.77 million for the nine-month period ended September 30, 2021.

Jamaica’s toll road operator reported no taxation charge for the nine months ended September 30, 2021, relative to a taxation credit of $4.83 million last year. As a result, net profit amounted to US$1.77 million, relative to a loss of US$3.83 million booked for the corresponding period last year.

Profit before taxation for the nine-month period was US$1.77 million versus loss before taxation of US$8.66 million for the comparable period in 2020. TJH reported a profit before tax of US$516,000 versus a loss before tax of US$2.74 million for the September quarter of 2020.

15% increase in revenues recorded

Net profit for the September quarter amounted to US$516,000 relative to a loss of the US$2.74 million in 2020. At the same time, TJH is reporting a 15 per cent increase in revenue to US$37.46 million relative to US$32.63 million in the corresponding period last year.

Revenue for the September quarter amounted to US$13.09 million (2020: US$11.22 million), a 17 per cent increase. TJH indicated that “this increase is as a result of the difference in measures implemented to combat the spread of the (COVID-19) virus.”

Other gains amounted to US$1.58 million for the three quarters of 2021, relative to other losses of US$68,000 for the comparable period in 2020. For the September quarter, other gains totalled US$53,000 relative to other losses of US$126,000 in 2020.

“Other gains and losses are comprised primarily of the gains produced by financial market operations and resulting financial income on investment instruments and the change in value of equity investments. Under the Concession Agreement, the company also has the right to collect revenues generated from commercial exploitation of the areas surrounding the Toll Road, including gas stations and related ancillary services, electricity and telecommunication cables and fibre optics,” TJH reported. 

Furthermore, the increase in other gains, “was primarily due to exchange gains realized on the revaluation of the 8.0 per cent (JMD) Cumulative Redeemable Preference Shares and also resulted from Interest earned on the investment of the Restricted Cash.”

Operating expenses going down

For the period review, operating expenses registered a seven per cent decline moving to US$25.06 million versus the US$26.99 million report in 2020. Operating expenses for the third quarter fell by 12 per cent to amount to US$8.56 million coming from the US$9.76 million posted in the comparable quarter of 2020.

The toll road operator explains that the decrease in operating expenses “was primarily due to lower maintenance cost and lower amortization of the intangibles (now being assessed and adjusted on a quarterly basis, rather than at year-end as per prior years). This was offset by an increase in the operator’s fixed fee.”

Administrative expenses decreased 20 per cent to US$712,000 for the period under review.

For the third quarter, there was a nine per cent increase in administrative expenses to total US$217,000. TJH mentioned that, “this increase was primarily due to low third quarter billing for executive compensation for which an adjustment was made during Q4 2020,”  adding that the nine months “was impacted by lower overall staff cost (including executive compensation) and savings in travel expenses.”

Debt savings caused finance cost to amount to US$11.51 million due to “the savings realized from the debt restructuring which saw our existing loans being repaid and the Secured Notes being issued during the first quarter of last year.” Finance cost for the third quarter ended September 30, 2021 came out at US$3.85 million when compared to US$3.88 million for the corresponding quarter last year.

Balance Sheet at a glance: 

As at September 30, 2021, total assets closed at US$316.36 million relative to US$325.07 million the prior year.  Notably, ‘deferred tax assets’ totalled US$22.06 million (2020: US$26.27 million) and ‘intangible asset’ amounted to US$228.89 million (2020: US$236.66 million) as at September 30, 2021.

Shareholders’ equity totalled US$58.81 million (2020: US$55.08 million) resulting in a book value of US$0.0047 (2020: US$0.0044).