5 months ago
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Student accommodation provider 138 Student Living Jamaica Limited, 138SL, hopes to come to an agreement with its host, UWI Mona, to settle monies owed to the company by the university.
Chairman Ian Parsard says receivables amounting to $700 million outstanding from the University of the West Indies could go a far way in reducing the company’s debt load and help to grow the business over the next few years.
“It is critical that we get to a point of an agreement on a number of issues with the university, which includes the amount of funds that are owed from the university to 138,” Parsard said at the company’s annual general meeting in New Kingston.
“We have a really good partnership, and there are a number of things that are intertwined between 138 and the university. Over time, we have done some netting off of what we owe to the university and what the university owes to us. But the balance that is owing is an important issue and one that we hope to have formal sign-off on with the university,” he said.
138SL was established a decade ago to construct and rent living facilities at UWI Mona under a 65-year concession agreement with that institution. The company’s subsidiary, 138 SL Restoration Limited, was also granted a 35-year agreement for the restoration and reconstruction of certain traditional halls of residence on the Mona campus.
Commenting on UWI’s debt to the company, Parsard told the Financial Gleaner that it was in the region of $500 million to $700 million.
He said the company would continue with its debt-restructuring exercise nevertheless.
“We want to ensure we have the right debt profile. We still would go ahead with the debt restructuring because that gives us more flexibility,” Parsard said.
The December quarter report showed that the company was making inroads into its debt.
“Current liabilities stood at $1.1 billion as of December 2024, reflecting a reduction of $262 million (19 per cent) from $1.4 billion at the end of the prior year’s first quarter. This decline was primarily due to repayments on long- and short-term loan notes,” 138SL said.
The group’s performance for the quarter under review improved over the previous year, with growth in both revenue, from $378 million to $412 million, and net profit, from $71 million to $82 million, reflecting gains of nine per cent and 16 per cent, respectively.
Average occupancy for the quarter reached 97 per cent, up from 93 per cent in the prior year.
The company’s total revenue surpassed $1.5 billion for the year ending September 2024, setting a new record.
CEO Cranston Ewan said although the company continued to operate on very tight fiscal policies, some costs rose during the year, such as insurance and internet service.
“We saw significant increases in insurance costs. In a lot of instances, property costs more than doubled, and we had to go to the negotiation table with our insurers to ensure that these costs were manageable for us,” Ewan said.
During the course of the year, the company switched its Wi-Fi provider and increased its bandwidth to meet the needs of the residents.
“We are very happy to report that we have seen significant improvements in this part of our service delivery,” Cranston said.
Commenting on the impact of 138 SL Restoration, Parsard said the company had been able to negotiate a significant increase on the rental of the rooms at Irvine Hall specifically, one of its newest buildings.
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