The diversification of revenue streams for 138 Student Living has proven to be a successful shift in the property management company’s operation as earnings continue to improve after period of paltry growth due to the COVID-19 pandemic.
The company reported improvement in both revenues and profit due to an average room occupancy of 86 per cent for the nine-month period ending June 30, 2023. This as the company continues to pursue short-term rental income as a supplement to revenues earned from student rental.
“To bolster revenue, the group has implemented multiple strategies geared towards energising short-term rentals. Evidently these have proven successful as short-term rental income contributed $35 million for the quarter and $96 million for the nine months, compared to $32m and $55m for the corresponding prior year periods, respectively,” Chairman Ian Parsard wrote in his report to shareholders.
The report accompanied unaudited results showing a 17 per cent increase in total revenue up to June 30, 2023, which totalled $1.05 billion.
Against that background, the company earned operating profit of $547.61 million, or 11 per cent more than $492.68 million earned up to June 30, 2022.
Net profit for the period of $270.06 reflected a 13 per cent growth for the period. Earnings per stock for the nine months moved from $0.58 to 0.65.
“We have emerged to be more resilient, having overcome the challenges of the last two and a half years. Our revenue and profit are on target for the remainder of the financial year, and we remain focused on executing on our key strategic initiatives,” Parsard stated optimistically.
“Looking ahead to the upcoming academic semester beginning September 2023, we see strong indications that operations have returned to normalcy, as applications for accommodation have significantly surpassed our current capacity,” he added.
For the quarter, revenue grew by 12 per cent or $38.11 million to $347.45 million. At the same time profit moved up 4 per cent to $88.92 million.
The chairman said that the company is also mindful of cost-cutting measures. He told Jamaica Observer further that, in the meantime, the company has embarked on pursuing groups coming to Jamaica for international events such as sports tournaments for short-term rental.
“Those kind of clientÃ¨le are well suited to the space and the offerings we have at 138SL and so we are targeting some of those and we’ve been fairly successful, and that has certainly resulted in boosting the results that we have had so far this year and will continue to be a focus going forward,” Parsard revealed.
With the properties managed by 138SL almost at capacity, and anticipation of increased demand for student housing, Parsard explained that the company is in preparation mode for expansion, which is far advanced. On this note, he pointed out that the company will be communicating plans for its capital raise in short order.