BC Ferries released its second-quarter net earnings and revenues for its fiscal 2021 and the numbers indicate the COVID-19 pandemic is continuing to have a “significant impact.”
In a period that ended September 30, the ferry company revealed that its net earnings in Q2 totalled $37.8 million – a decrease of $57.2 million from the same quarter in 2019.
For BC Ferries’ year-to-date numbers since April 1, net losses have totalled $24.2 million. This compares to net earnings of $107.2 million over the same period in 2019, which is a decline of $131.4 million according to the company.
“COVID-19 continues to have a significant impact on the ferry system as we navigate through what is now the new normal with our employees, our customers and all British Columbians,” said Mark Collins, BC Ferries’ President and CEO. “Throughout the pandemic, our employees continue to provide lifeline service to coastal communities and I want to recognize their dedication and perseverance, which has been nothing short of inspiring.”
As far as revenue goes, the company reported $247.6 million in revenue for the quarter. This is down $81.7 million year-over-year.
The press release from BC Ferries outlines that revenue for the six months ended September 30, 2020, was $385.0 million, down $190.7 million over the same period in the prior year.
Along with drops in net earnings and revenue, BC Ferries is reporting diminished ridership as well.
In Q2, the transportation company says it carried 5.5 million passengers and 2.5 million vehicles. These are decreases of 29.0 per cent and 14.0 per cent respectively from 2019.
Since April 1, the company has carried a total of 7.7 million passengers and 3.8 million vehicles, a decrease of 43.0 per cent and 28.7 per cent, respectively.
For expenses from operations, Q2 saw a decrease of $25.4 million and a year-to-date decrease of $62.1 million.
The decrease in expenses includes reduced labour costs, fuel consumption, maintenance, contracted services, depreciation expense, travel, non-safety related training and advertising.
“These cost reductions, while helpful, did not offset the decline in revenues as a significant portion of BC Ferries costs are fixed and do not meaningfully fluctuate with reduced traffic demand,” reads a statement from BC Ferries.
Back in September, it was revealed that BC Ferries would be the recipient of $308 million under the Safe Restart Funding Program as part of a bailout from both the federal and provincial governments. The government spending has been finalized in the weeks following the announcement and will help the organization cover costs in the immediate future.
“Prior to COVID-19, our 12-year capital plan totalled $3.9 billion and included new vessels, upgrades and modifications for existing vessels, significant improvements at our fleet maintenance unit, major investments at terminals and renewal of information technology systems,” said Collins. “Given the impact of the pandemic to our operations and financial position, we are reviewing all capital plans to identify opportunities to defer any expenditures that are not regulatory, security or safety-related or operationally necessary. It’s imperative that we scrutinize everything we do to preserve the long-term sustainability of the ferry system in the public interest.”
According to BC Ferries, capital expenditures in the three and six months ended Sept. 30, 2020, totalled $25.7 million and $49.3 million respectively. Significant investments include the five new vessels currently under construction contracted in 2019, major vessel overhauls and inspections, IT upgrades and various other projects.
To full fiscal report can be viewed at www.sedar.com
Graham Cox
