CariCRIS Reaffirms ‘Good Creditworthiness’ Ratings on Port Authority of Jamaica 

• Caribbean Information and Credit Rating Services Limited (CariCRIS) has reaffirmed the Issuer/Corporate credit ratings of CariA- and CariA (Foreign and Local Currency Rating) on the regional rating scale, and jmAA+ on the Jamaica national scale to the Port Authority of Jamaica (PAJ). The ratings include a single notch up for the likelihood of support, if needed, from the Government of Jamaica (GOJ).
• The regional-scale foreign and local currency ratings indicate that the level of creditworthiness of PAJ, relative to peers in the Caribbean, is good, while the national scale ratings indicate that PAJ’s creditworthiness, relative to peers in Jamaica, is high.
• CariCRIS also assigned a stable outlook to the ratings, reflecting the high likelihood that PAJ will maintain its profitability and credit metrics over the next 12–15 months. This is supported by solid cargo operations, institutional stability from PAJ’s legislative mandate, and ongoing infrastructure modernisation across the cargo, cruise, and Business Process Outsourcing (BPO) business lines.
• A gradual improvement in global economic activity, with strengthening global cargo and cruise market conditions, is expected to sustain revenue generation and operating performance. Consequently, PAJ is projected to maintain sound financial metrics, stable cash flow generation, strong capitalisation, and adequate debt service capacity over the next 12 – 15 months.
• Changes in operating and financial fundamentals, as well as external conditions, are factors that could lead to a rating change on the PAJ. If Jamaica’s credit rating improves over the next 12–15 months or if PAJ demonstrates stronger performance with increased revenue or profitability, sustaining a Debt-Service Coverage Ratio (DSCR) above 2x over the next two years, PAJ could be upgraded.  However, if the agency experiences adverse changes to concession agreements that reduce guaranteed revenues, or from weakening financial metrics, including DSCR falling to 1.5x or below or Return on Assets (ROA) to 3.3% or below for two consecutive years, it could be downgraded.
• Notably, the recent rating affirmation disclosed that the PAJ has shelved the planned listing of its BPO assets on the Jamaica Stock Exchange (JSE) due to prevailing market conditions. The PAJ will instead concentrate its efforts on the Caymanas Special Economic Zone (SEZ), on which it intends to spend $8.88Bn in the current March 2027 fiscal year.
• As early as 2021, the PAJ had indicated plans to list an entity which would manage its  BPO real estate assets totalling 852,276 square feet. These assets were situated at SEZs in Montego Bay and the Portmore Informatics Park. The privatisation effort was being handled by the Development Bank of Jamaica, which handles public-private partnership (PPP) transactions. The monetisation of these assets was expected to support investments into other critical projects.

(Sources: CariCRIS & Jamaica Observer)