The Jamaica Pegasus hotel in New Kingston, St. Andrew. - File

Ashford W Meikle, Business Reporter

The expected windfall from Cricket World Cup (CWC) 2007 did not mate-rialise and occupancy levels were down, but Jamaica Pegasus still carved out a healthy 136 per cent increase in net profit on increased room rates and a tight grip on expenses.

Revenues for the Pegasus - the sole hotel listed on the Jamaica Stock Exchange - climbed to $738 million, a respectable 12 per cent increase while its net profit increased by almost $24 million, to $54 million during its financial year ended March 31.

"We had a rate increase in October (2006) and, as a result, we were able to get better yields," general manager, Eldon Bremner, told Wednesday Business on Monday.

However, with the hotel's occupancy level slightly below the previous year's average - industry analysts estimate that Pegasus' occupancy rate is about 55 per cent, just below competitors Courtleigh and Hilton Kingston - Bremner expressed disappointment that the growth in the company's earnings did not come from increased bookings prior to and during CWC.

The competition attracted less than 10 per cent of the 40,000 visitors that organisers had expected over the tournament.

"I don't know why but in the month prior to Cricket World Cup (CWC) a lot of people restricted their travel. I expected that it would have increased [during CWC] but that didn't happen," said Bremmer. "Also, during the summer months when we usually do well, because of predictions of an active hurricane season, what you found is that people arranged their business trips not to coincide with the summer months. It didn't happen - as a matter of fact it was a very soft hurricane season."

The general manager pointed to the flat increase in the hotel's utility bills as evidence that its conservation efforts were working.

Administration and operating expenses lagged behind revenue growth - seven per cent.

"We had a target of 14,000 kilowatt hours consumption per day and we got a mandate from the board to get it down to 12,000 [and] I think we are down to 13,000 now," Bremner said.

Electricity costs - estimated at about $6 million per month - increased by just three per cent, noted the general manager, chiefly as a result of the energy-savings bulbs installed and conservation on air-conditioning in unoccupied rooms.

Increased assets

The hotel's balance sheet indicates that its assets increased in value by about 13 per cent during the year.

However, the most impressive growth was in the eight and half acre property on which the hotel sits. The land, according to the latest revaluation, is worth $902 million, or roughly US$1.5 million per acre, a 25 per cent increase over the previous year's valuation of $722 million.

ashford.meikle@gleanerjm.com