REGENCY Petroleum Limited (RPL) is pressing ahead with ambitious expansion plans after reporting a 90 per cent increase in annual net profit, with two major new projects currently under negotiation as the company strengthens its market position in Jamaica’s energy sector.

The company has demonstrated remarkable financial growth in the past year, with its net profit climbing from $45.76 million in 2023 to $86.85 million in the most recent financial year which ended December 31, 2024. This 90 per cent increase in profitability showcases the company’s successful implementation of its business strategy. Along with the profit surge, RPL also reported a 76 per cent increase in revenue, which grew to $1.63 billion, largely supported by the addition of its third service station. Chief Executive Officer Andrew Williams emphasised that these results reflect the company’s commitment to its strategic vision, noting during an earnings call that “it shows [our] commitment to what Regency sets out to do.”

The financial growth has been primarily driven by RPL’s expansion into service stations, which has shifted the company’s revenue composition. Financial controller Jerry Grant explained this transformation as a “composition shift” resulting from the increased contribution of the gas station business to overall revenue. The growing importance of the service station segment has reduced the LPG segment’s contribution to total revenue from 24 per cent last year to just 8 per cent currently. Despite this proportional decline, the company continues to see significant growth potential in the LPG market due to its attractive profit margins.

Over the past two years, RPL has significantly expanded its footprint with the addition of service stations in Westmoreland and Kingston. The company’s Kingston service station, which opened in December 2024, represents its most recent expansion and is reportedly operating according to plan. This development has increased RPL’s operational capacity to three fully functional service stations.

In addition to building its own service stations, RPL has broadened its market presence through strategic partnerships. The company secured a franchise agreement with Juss Gas and the Whithorn service station in Westmoreland, further extending its reach in the petroleum retail market. These developments align with RPL’s phased approach to expansion, which focuses on establishing a strong operational presence before pursuing additional growth opportunities.

Now operating three fully functional service stations, RPL is focusing on assessing its financial performance before advancing new projects. Williams said two projects are currently under negotiation, one of which will require significant financing.

“These two projects, I cannot speak on them right now because they are in preliminary negotiations,” he added.

He indicated that the company is monitoring market conditions and expects to finalise decisions in the second half of the year. RPL intends to use this quarter to assess its service station operations and LPG business before making further investment decisions.

“I’m hoping that if all goes well, we can have at least one, if not both, projects off the ground this year,” he said.

Williams revealed that part of the company’s future plans includes the expansion of its household LPG segment, building upon its existing bulk LPG distribution business. While LPG operations did not contribute significantly to the company’s performance last year, investments made in the segment are expected to yield stronger results in 2024. The company’s LPG operations started in Westmoreland and have since expanded to Hanover and parts of St Elizabeth. Williams said further expansion is under consideration but will be pursued cautiously.

“It wouldn’t be prudent for us to jump into St James just yet. We have plans to go to St James and the Corporate Area. I wouldn’t say very soon, but soon, we have plans coming on board,” he outlined.

As RPL considers its next phase of expansion, the company is also evaluating options to refinance debt that was incurred to build its third gas station in Kingston. The station was initially expected to begin generating revenue in early 2024 to help service this debt, but delays pushed back the timeline. Williams expressed confidence that the station should be able to cover the loan repayment but indicated that the company will explore refinancing options in the next quarter to optimise its financial position.

With the addition of new service stations, the LPG segment’s share of total revenue has declined. The company is monitoring its financial position and market conditions before deciding on its next phase of expansion.