Following the hiccup caused by the COVID-19 pandemic, Dolphin Cove Limited has put a 22-acre waterfront property in Hanover on the market for US$18 million (J$2.79 billion) as it seeks to have a family resort hotel developed on the space.

The tourist attraction business had sold a US$100,000 (J$13.6-million) option in March 2020 to Reserve Investments Limited, a subsidiary of a Spanish-speaking hotel developer, for the right to purchase the property which would be developed into a hotel. The plan was to have the marine park to continue operating on the property and be part of the hotel’s offerings to drive additional business to the company which has dolphins, birds and other animals at its facilities.

However, that plan evaporated when the pandemic sent the world into a tailspin and jettisoned several planned tourism developments, the sector which was the hardest hit during the global crisis. As a result, Reserve Investments didn’t pay an extra US$100,000 to extend the option for a year which left Dolphin Cove with the property. Thus, Dolphin Cove (Negril) Limited, the company retained the land, and Dolphin Cove Montego Bay, the name given to the Lucea attraction, continued to operate as normal.

“Our plan is to get a family resort developed on the property. We bought the land at a good price many years ago. We had actually gotten a letter from NEPA (National Environment and Planning Agency)with the first guy giving us permission to build eight stories high and 850 rooms. We had gone down the road with NEPA. We have a head start there. So, a new developer can benefit from some of the work that was done from the environmental part and NEPA’s part as far as a new hotel is considered,” said Dolphin Cove Founder and Chairman Stafford Burrowes at the company’s annual general meeting at the Courtyard by Marriott Hotel in New Kingston, St Andrew.

The property is currently being advertised on Coldwell Banker, a property website, and Burrowes noted he’d be glad if an existing hotel chain operator that does business in Jamaica expresses an interest. He also noted that a sale of the property is not the only consideration as they’d be open to other arrangements such as a joint venture arrangement, but added that Dolphin Cove doesn’t intend to be involved in hotel operations.

Dolphin Cove currently employs 240 people across four facilities with offerings ranging from interactions with dolphins, purchasing food and gifts or even using the ATV’s, dune buggies and ziplines at the Yaaman Adventure Park in Ocho Rios, St. Ann. The company has rebounded from the pandemic and states of public emergency to post its highest consolidated revenue of US$17.11 million and profit before tax (PBT) of US$3.95 million in 2023. This is relative to 2017 when it generated US$16.63 million in consolidated revenue and US$3.94 million in PBT.

Dolphin Cove had 153 employees in 2019.

“We are not closing the facility but are looking for a developer which will build around the dolphin habitat. The dolphin park will remain open to the public but will always benefit from the large increase in patronage from the family resort it will become the feature of. All of this sounds good for our 2024, 2025, 2026,” Burrowes explained to shareholders.

Even with several hotel operators lamenting the impact of the US travel advisory in January, Burrowes noted it had “very little impact [on his operations]. In fact, you can measure the impact it has had on the country. More arrivals than normal. It has had no negative impact whatsoever.”

However, he did mention that the Dolphin Cove team had to go over and beyond to redirect traffic to the facility following recent damage to the Ocho Rios cruise ship pier which will be out of use for at least six months according to its first-quarter (Q1) report. This required his team to do additional work to mitigate the estimated US$250,000 of lost cruise ship business from the 30 cancelled cruise ship calls to their star property in Ocho Rios near Dunn’s River Falls.

Despite the delay in getting the pier back up, Burrowes is encouraging the authorities to consider adding another “finger” to the pier so that four ships could be accommodated at the space at any one time. He noted that this will be crucial as larger ships visit Jamaica and that the ability to accommodate six ships between Ocho Rios and Falmouth would make Jamaica a more premier destination.

“We’ll probably be without the pier for a year. Everything goes to Falmouth and Montego Bay. We still get a good turnout from Falmouth. One of the biggest drawings by far is Dunn’s River Falls. If you’re in Falmouth and going to go somewhere, you’re going to come to Dunns River Falls side and we’re there. It’s just my hope that the powers that be can see the benefit of being able to accommodate more than two ships in Ocho Rios. It solves a lot of problems,” Burrowes added.

Dolphin Cove’s Q1 saw consolidated revenue move up from US$4.85 million to US$4.90 million with gross profit remaining relatively flat at US$4.35 million. Due to higher operational expenses and decrease in impairment provisions on trade receivables, Dolphin Cove’s operating profit declined by eight per cent to US$1.76 million.

Profit before taxation decreased six per cent to US$1.68 million with net profit coming in 12 per cent lower at US$1.38 million which resulted in an earnings per share of US$0.0035.

Dolphin Cove will also be settling with Tax Administration Jamaica for a US$1.13 (J$177.64 million) liability relating to the 2019 period over ten monthly instalments. This is to begin in short order.

Dolphin Cove’s total assets were up one per cent during the quarter to US$37.95 million with non-current assets at US$31.38 million and cash and cash equivalents at US$2.08 million. Total liabilities and shareholder’s equity were US$6.16 million and US$31.79 million, respectively.

Dolphin Cove’s stock price was down on Thursday to J$23.13 which leaves it up 31 per cent in 2024 with a market capitalisation of J$9.08 billion (US$57.92 million). Dolphin Cove paid a J$0.60 dividend on June 21 totalling J$235.46 million (US$1.50 million). This brings the trailing 12-month dividend to J$2.40 and the dividend yield up to 10.38 per cent. Dolphin Cove also intends to return to a quarterly dividend schedule, something not seen since 2017. Dolphin Cove is a 79.99 per cent subsidiary of Mexican-based Dolphin Capital Company S. de RL de C.V. with Gonzalo Pachéco Perez as the CEO of Dolphin Cove.