Damian Obiglio, president of Jamaica Public Service Company.

Jamaica Public Service Company's fuel bill skyrocketed 73 per cent to $39 billion in the first nine months of this year, but carefully managed expenses has transformed the utility from a lossmaker to a position of strength that comes from having more than half a billion dollars of profit.

In the nine-month period to September 30, JPS reported profit of $566.4 million after taxes; pretax profit was $659 million. Last year at the same time, it was $94 million in the red.

The majority $383 million, was made in the third quarter, despite a doubling of its fuel bill close to $16 billion in the period.

Rise in revenue

The company's improved position was primarily due to the substantial rise in revenue, which grew $47 per cent, from $38.7 billion to $57 billion. But JPS also managed to carve $1.5 billion off its cost of doing business to increase gross profit to $13.7 billion.

Additional gains came from the scalpel wielded against operating expenses - the company shaved close to $400 million off selling and administrative costs, and another $600 million off its maintenance bill - which even after depreciation charges were applied, gave the company $3.2 billion of operating profit, $200 million more than the outcome in September 2007.

The company also reported an improved balance sheet of $58 billion. Total assets climbed by $5.8 billion, on gains in its fixed assets, which were valued on the balance sheet at $50 billion, up from $44 billion.

Shareholder equity also rose from $28.5 billion to $31.7 billion.

business@gleanerjm.com