WIP Terminal Limited, the storage and logistics arm of the West Indies Petroleum Group, is entering the public arena with a listing on the Jamaica Stock Exchange (JSE). The move, executed by way of introduction and not accompanied by a fresh capital raise, will see 11.18 billion shares priced at $0.50 each hit the exchange — pegging the company’s valuation at J$5.59 billion (approximately US$36.1 million).
The decision brings the fuel storage business into clearer market view, offering liquidity to its primary shareholders, WIP Energy Limited and World Energy Solutions, who control nearly all outstanding shares. The listing follows a strategic corporate reshuffle earlier this year, in which WIP Energy took control of the terminal entity from the broader West Indies Petroleum Group — a step aimed at increasing capital markets engagement and unlocking shareholder value.
From Acquisition to Exposure: A Storage Strategy Unfolds
The current milestone reflects a longer-term trajectory. WIP Terminal’s roots date back to its 2016 acquisition of the Port Esquivel terminal from Jamaica Broilers — transforming a former ethanol facility into a key fuel storage hub. With a capacity now at 740,000 barrels, the terminal forms a critical asset for Jamaica’s energy supply chain and underpins much of the group’s bunkering and fuel distribution activity.
The company’s operational edge is in the integration of supply and storage, but this public listing marks a shift: from private asset base to publicly visible financials. And with visibility comes scrutiny — especially in a period where profits have narrowed, and short-term liquidity is under significant pressure.
Profit Squeeze Amid Asset Growth
Although top-line revenue grew by over 8% in 2024, net income collapsed by nearly 52%, dragged down by swelling finance costs and a full impairment on a note receivable from an affiliated entity. The impairment — totaling US$1.04 million — wipes out the value of a promissory note tied to World Energy Solutions’ equity stake, effectively acknowledging the note’s non-recoverability.
In parallel, total assets rose 20% to US$41.8 million, driven primarily by non-cash gains: a US$4.8 million property revaluation and lease asset recognition. Yet despite this paper strength, the company ended the year with just over US$11,000 in cash — a dangerously thin cushion against US$5.95 million in current liabilities. Nearly three-quarters of this debt is owed to a related party, underscoring the group’s reliance on internal financing channels.
A Sound Structure, but Stress at the Core
Financial ratios on paper look solid: debt-to-equity remains low, and EBITDA coverage is within covenant thresholds. But these metrics don’t tell the full story. Liquidity remains the most immediate concern. With a shortfall in operational cash and rising repayment obligations due within three months, WIP Terminal is effectively walking a tightrope.
The company has previously restated figures to remain covenant-compliant, including reclassifying certain borrowings to non-current liabilities. While not uncommon, such technical maneuvers can dampen investor confidence — particularly when paired with weak free cash flow.
Strategic Anchors in Place, but Eyes on Diversification
Despite the financial constraints, WIP Terminal still offers a compelling infrastructure play. Located in a Special Economic Zone and benefiting from a reduced corporate tax rate of 12.5%, its assets are difficult to replicate and central to the national fuel ecosystem. The parent group claims dominance in the bunkering and retail fuel sectors — positioning WIP Terminal as a crucial node in Jamaica’s energy grid.
Still, dependence on internal group revenue remains a risk. As of Q3 2024, 93% of revenues flowed from WIP Energy. Recent storage deals with Musket, TotalEnergies, and Sunoco LP suggest management is moving to diversify. Future regional ambitions — including potential terminal operations in The Bahamas and Panama — are also noted, though timelines remain vague.
Governance and Oversight
The board of directors includes several independent voices — Kurt Boothe, Amanda Levien, and Karl Townsend — with Townsend also chairing the audit committee. VM Wealth Management is listed as sponsor and broker, and the company received a clean audit from PwC East Caribbean. These signals help shore up confidence ahead of trading commencement, offering some counterweight to concerns over liquidity and internal receivables.
Conclusion
WIP Terminal’s debut on the JSE is less about raising capital and more about institutionalizing its next chapter. For a company rooted in hard infrastructure and market incumbency, the future hinges on translating those strengths into broader market trust — and operational resilience. With minimal cash on hand, investor attention will quickly shift from potential to performance.
