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BC Ferries shows huge losses due to COVID-19 in first quarter results

– with files from Patti Mertz

The latest financial report shows BC Ferries lost 62 million dollars in the first quarter of this fiscal year. That is compared to net earnings of over 12 million over the same time last year.

In the early days of the pandemic, ferry traffic dropped on most routes by up to 80 per cent.

Since the Province eased up on travel restrictions, the number came down to 35 per cent.

The corporation is still going full steam ahead though, with plans to improve safety and core services, and finish building five new ferries. It will get help from the federal and provincial governments, who will provide over 1 billion dollars of COVID-19 “transport” relief funding.

“While COVID-19 continues to have a profound impact on our business, I want to express my deep appreciation to our frontline staff who came to work every day in the depths of the pandemic to provide lifeline service to coastal communities,” said Mark Collins, BC Ferries’ President and CEO. “I also want to thank our customers for their patience as we all work towards a new normal.”

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Revenue for the quarter ended June 30, 2020, at $137.4 million, was down $109 million yearover-year. This impact to earnings was partially offset by reductions in operating expenses of $36.7 million compared to the same quarter of the prior year.

In response to COVID-19, BC Ferries deferred capital expenditures and has, and will continue to, reduce discretionary spending while operating a sustainable, safe and reliable service. The company also worked with the Province to reduce sailings to match the significant drop in traffic.

“We made prudent decisions to remove costs for the health of the ferry system. This is decisive action to safeguard the coastal ferry service for the long term, while continuing to provide essential services to customers and communities,” said Collins. “We have been bringing back service capacity to coastal communities ahead of gradually increasing demand.”

During the three months ended June 30, 2020, BC Ferries delivered 18,249.5 round trips, a decrease of 2,340 or 11.4 per cent compared to the same period in the prior year. The company carried 2.2 million passengers and 1.3 million vehicles during the quarter, a decrease of 61.5 per cent and 46.7 per cent, respectively, compared to the same quarter in the prior year.

On August 11, 2020, the Province announced BC Ferries is one of the entities included in the federal government’s previously announced transit funding of $540 million in response to the impact of COVID-19. This transit funding is to be matched equally by the Province for a total funding envelope of $1.08 billion.

As part of the company’s capital plan, in mid-June 2020 BC Ferries brought into service two new Island Class vessels. Island Discovery now sails on the Powell River – Texada Island route and Island Aurora commenced service between Port McNeill, Alert Bay and Sointula Island.

These two new Island Class vessels are hybrid-electric ships designed for future full electric operation. The addition of these vessels allowed for the retirement of two older ships.

BC Ferries will carry on with essential investments in safety and core services, as well as construction of four more Island Class ferries and one additional Salish Class ferry currently underway. As the company responds to COVID-19, it will continue to provide resilient ferry service in the public interest. BC Ferries will aid B.C. in its economic and social recovery through the vital role it plays in serving the needs of coastal communities.

BC Ferries’ full financial statements, including notes, and Management’s Discussion and Analysis are filed on SEDAR and will be available here.

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