Call me a prophet AGAIN because I told you to watch TransJamaica stock in November last year.  Well, it hit $2 for the first time in mid-May!  Cha-ching!

So, TransJamaican Highway, or TJH, is the company responsible for developing, operating and maintaining the East to West tolls of Highway 2000. Those are the tolls from Mandela Highway in St Catherine to May Pen in Clarendon, and the Portmore toll road.

TJH’s IPO came at the worst time ever!  The government spent a lot of money educating Jamaicans about it.  If any IPO ever get a hype, this was it. It was marketed as our chance to own a piece of Jamaica and it worked.  Thousands of people, including many first-time investors, bought into this stock.

The IPO raised J$14 billion, that’s about US$91 million, and it was the largest amount ever raised from an IPO on the JSE.

And then BOOM! Covid!  TJH listed in March 2020, like a week or two after the pandemic hit.  So of course, it got caught up in one of the biggest and fastest stock market declines in Jamaica ever!  The JSE fell 30% in those couple of weeks alone.

You have to remember a lot of new people were investing, and many had the expectation that this would be quick and easy money.  Flipping IPOs had become a thing.  People were thinking oh I could buy TJH at $1.41, and sell it like a week later at $3.  But that neva happen.  

When Covid hit, the government had to close the borders, which meant the entire tourism industry was shut.  Then we had curfew after curfew, so businesses were severely impacted. A lot of people lost their jobs.  And if you had put a lot of money into TJH with the intention to cash out quickly, you were in trouble.  Because now you need back your money because you lost your job, and basically everyone was trying to sell at the same time.  And you know what happens then – I always talk about supply and demand.  If everybody’s trying to sell at the same time, the stock price is going to fall because you want to just take what you can get at that point.

And also remember the whola St Catherine was even under lockdown at one point. So nobody was travelling. So no toll payments. And obviously, that impacted TJH’s bottom line.  The company recorded a net loss of US$1.87 million in 2020.

BUT! If the company’s first-quarter results for 2023 are anything to go by, TJH is making a comeback!  Revenues went up by 21%for the first quarter ended March 31.  TJH brought in approximately US$18 million, compared to US$14 million for the same period the year before.

But the net profits are what’s really got everyone excited. TJH recorded net profits of US$5 million compared to just US$700,000 for the same period last year. That’s a 600% increase in one year! Impressive.

And the market definitely reacted to the news. The stock closed on May 16 at $2.04, which is the highest it’s been since the IPO in 2020.  It’s come down slightly since then, but still.

It’s probably easy to figure out why the numbers are turning around. OUTSIDE AH KEEP!

The Government lifted restrictions on movement and entertainment so people are getting back into the swing of things, travelling and going to parties more.

Plus, a lot of jobs have gone back to work in-person.  Schools are face-to-face again, so that means more people are on the road. Also, tourism is booming in Jamaica right now. And I’m not just talking international travel. A lot of Jamaicans are going on staycations, exploring the island, and the quickest way to get from point A to point B is through the toll.

And TJH raised toll prices last year too. So the cost of the toll is more and the volume of traffic is more. That’s a good equation for higher revenues and profits.

We talked about this on Taking Stock recently and business Journalist David Rose also pointed out that Easter weekend numbers aren’t even in the March report, so imagine the next quarter’s numbers!

Oh and remember carnival was in April and that was record-breaking for other industries. People were travelling from all over to get to events.

Plus summer is basically here and this year there are absolutely zero restrictions and like I said OUTSIDE AH KEEP.

And on top of that the May Pen to Mandeville leg of Highway 2000 is expected to be done by late summer, which will be another boost to the company’s revenues.