BC Ferries sailed into uncharted waters by hitting a historic high watermark for the first fiscal quarter this year.
According to an Aug. 15 BC Ferries news release, passenger and vehicle traffic numbers are the highest the company has ever experienced in the first quarter of a fiscal year.
Net earnings for the first quarter of fiscal 2020 were $12.2 million, more than double the $6 million total for the same quarter of the previous year.
“Net earnings are essential for us to fulfill our commitment to support the growing needs of coastal communities,” BC Ferries president and CEO Mark Collins said in the release. “With the public interest in mind, we reinvest all earnings back into the ferry system. This is evidenced by our $26 million of investments this quarter which is more than our $12.2 million of net earnings.”
That enables expanded service, larger ships, upgraded terminals, debt reduction and financial sustainability, Collins added.
BC Ferries provided more than 700 additional round trips compared to the same period last year to accommodate higher traffic volumes and deliver the increased service levels agreed to with the province. The company also introduced the Northern Sea Wolf into service and brought the upgraded Spirit of Vancouver Island back into service, which contributed to a 7.3 per cent increase in revenue and a corresponding 5 per cent increase in expenses, compared to the first quarter of the previous fiscal year.
The company invested $26 million focused on replacing ships and upgrading terminals as part of a $3.9 billion 12-year capital plan. “Our capital plan is vital to maintain an efficient ferry service that meets the increasing demands on the system,” Collins said. Half the fleet must be replaced during the next 15 years to incorporate clean technology and increase capacity, he noted.
At the start of fiscal 2019, which began April 1, 2018, BC Ferries reduced fares, with partial funding from the province, on the minor and northern routes by 15 per cent as part of its continued focus on fare affordability. Fares on the three Metro Vancouver-Vancouver Island routes remained constant, and no fare increases will be introduced in fiscal 2020.
“Focusing on cost improvements in fuel, maintenance, labour and increasing diversified revenues are ways we reduce upward pressure on fares,” Collins said.
Between April 1 and June 30 of this year, BC Ferries delivered more than 45,000 sailings for an average of 497 a day. There was an increase of 3,268 more round trips than required under the Coastal Ferry Services Contract. BC Ferries carried 5.8 million passengers, an increase of 2.2 per cent from the same quarter in the previous year. The total of 2.4 million vehicles marks an increase of 2. 5 per cent for the same period.
For a look at the full report, financial statements and Management’s Discussion Analysis, sail over to sedar.com.