TJH Continues to Deliver Strong Results

• TransJamaica Limited recorded net profit of US$13.92Mn for the six months that ended June 30, 2024, a 26.5% yoy increase. The outturn reflects the impact of robust topline growth and modest growth in expenses.
• Aided by higher traffic volumes and movements in the toll tariff, which is reviewed annually, revenue for the six-month period was US$39.65Mn, US$3.44Mn higher when compared to the same period in 2023.
• The company reported operating expenses of US$11.37Mn, marking a 3.8% rise from the US$10.96Mn recorded during the corresponding period in 2023. Elevated intangible amortization and security expenses, which were partly counterbalanced by a reduction in maintenance activities throughout the period, resulted in modest growth in operating expenses.
• However, administrative expenses rose 18.0%, given salary adjustments following a restructuring exercise and the usual annual inflationary increments. The team expanded with the recruitment of extra technical personnel, including a special projects manager tasked with spearheading the infrastructure enhancements throughout the network.
• TransJa's stock price has increased by 13.3% since the start of the calendar year. The stock closed Monday’s trading session at $3.07 and currently trades at a P/E of 9.0x, which is below the Main Market Energy, Industrial, and Materials Sector Average of 9.6x.
• TransJamaican Highway Limited (TJH) recently proposed a US$20.3Mn offer price, along with potential Upside Formula amounts, to acquire the concession to operate Phase 1C of the Highway 2000 toll roads until November 20, 2036. The government’s acceptance is subject to contract and additional conditions. The addition of this new concession should enhance the company's portfolio by introducing a fourth toll road, which is expected to bolster earnings when it becomes operational.

(Sources: JSE and NCBCM Research)