Regency on profit pace as it plots north coast entry

Regency Petroleum Ltd won planning approval for its first service station along the north coast, and its seventh in total, as September-quarter net profit rose 46 per cent to $31.6 million.

It puts the fuel and cooking gas retailer on a path to record annual profit.

The company received approval last month from the National Environment and Planning Agency to build a service station, mini-mart and commercial building in St James.

“In terms of size, it will be similar to our Paradise location. It’s a standard size. It’s our standard build out, not bigger, not smaller, just standard,” chief executive officer Andrew Williams told the Financial Gleaner.

The planned station sits at Norwood in St James, a project management views as a strategic entry into one of Jamaica’s fastest-growing commercial corridors. The facility will feature four pumps capable of serving up to eight vehicles simultaneously and will require an investment of approximately $160 million to $170 million.

Construction is expected to begin within six to eight months and take between nine and 12 months to complete, according to Williams. Once operational, the development will expand Regency’s network to seven service stations.

The Norwood project is expected to fill a noticeable gap in fuel retail coverage in the Montego Bay area. While fuel stations are concentrated around Ironshore and farther east towards Greenwood, the rapidly growing Norwood corridor has comparatively limited service options despite continued residential, commercial and industrial expansion. Regency is positioning the location to capture increasing traffic flows generated by that growth and establish an early foothold in a market with significant long-term potential.

Revenue for the September quarter climbed 21 per cent to $477.9 million. The improved performance was underpinned by higher fuel volumes, stronger margins and contributions from an expanding network of retail and liquefied petroleum gas operations.

Gross profit increased sharply to $97.9 million from $67.1 million a year earlier, while operating profit more than doubled to $45.4 million. Earnings per share rose to 2.2 cents from 1.5 cents.

The September-quarter outturn capped another period of strong growth for Regency, which has been steadily widening its footprint through acquisitions and new developments.

For the nine months ended September, revenue reached $1.34 billion, while net profit climbed to $82.7 million. Although revenue remained below the company’s full-year 2024 turnover of $1.63 billion, its $260.8 million in gross profit had already surpassed the entire 2024 figure of $248.4 million. More notably, nine-month earnings were equivalent to 95 per cent of the $86.8 million generated during all of 2024, placing the company on track to establish a new annual profit record with one quarter still to come.

A key contributor to that growth, Williams said, has been the acquisition of the Crawford service station and LPG operation from Yaadman LPG. The transaction has expanded Regency’s reach in the cooking gas market while strengthening its presence in south-central Jamaica.

“That acquisition is really paying off and it has given us a solid presence in the market,” Williams told the Financial Gleaner.

The company is also rehabilitating the Crawford facility after it sustained hurricane-related damage. Williams said restoration work is approximately 80 per cent complete, with management expecting the location to become a more meaningful contributor to revenue and earnings as integration efforts progress.

While the Yaadman acquisition is beginning to bear fruit, Regency’s growth plans stretch well beyond its existing operations.

At Norman Manley International Airport, the company is advancing what could become one of the most strategically important assets in its portfolio. Although progress has moved more slowly than originally anticipated, Williams said the project remains on track and construction activity is expected to accelerate in the months ahead. The airport location would provide direct exposure to one of Jamaica’s busiest transportation gateways, serving airport users, commercial operators and motorists travelling through the wider Kingston metropolitan area.

Meanwhile, Regency has restarted work on its long-delayed Clarendon service station after roughly two years on hold. Construction is now under way, with completion targeted for the end of the first quarter and commercial operations expected to commence in the second quarter. The project will strengthen Regency’s presence along the south coast and deepen its footprint in a parish where management sees considerable growth opportunities.

With the Crawford LPG acquisition being integrated, rehabilitation work nearing completion, and three major developments progressing simultaneously, Regency appears to be entering a new phase of expansion. The company’s growing national footprint is already translating into stronger financial results and, with profits approaching last year’s full-year record, management looks poised to deliver its strongest performance to date.

neville.graham@gleanerjm.com