Increased Traffic Positively Impacts BC Ferries' Year-End Results
British Columbia Ferry Services Inc. has released its year-end results for fiscal 2017 and for the second consecutive year, BC Ferries’ positive results have allowed the company to hold the cost of travel for passengers and vehicles at 2015 rates on the majority of its routes. Consolidated net earnings were $77.4 million for fiscal 2017.
“This strong financial performance will be essential in helping us renew the fleet, pay down debt, as well as reduce our future borrowing and associated costs. As a more sustainable ferry service provider, we will be better able to deliver fare stability, and continue to provide safe and reliable service to our customers,” said Mark Collins, BC Ferries’ president and CEO. “B.C.’s coastal ferry network needs about a ship each year for the next 12 years at an average cost of $70 million. Solid earnings from the growth in traffic is helping build a strong system for the communities we serve.”
In fiscal 2017, BC Ferries experienced a 2.9 per cent increase in vehicle traffic and a 1.7 per cent increase in passenger traffic compared to fiscal 2016. These traffic levels are the highest BC Ferries has experienced since fiscal 2008. The general increase in travel and tourism experienced in B.C. has a positive economic effect on coastal communities and BC Ferries.
Revenues for the year increased $24.7 million, from $834.6 million to $859.3 million, primarily due to higher traffic levels and retail sales, partially offset by an additional $11.7 million in fuel rebates provided to customers. Higher traffic levels also affected operating expenses, which increased $17.2 million, from $709.0 million to $726.2 million, compared to the year prior. The main increases were in labour costs, contracted services, training activities, and parts and supplies, partially offset by lower fuel costs.
“A significant step forward this year is the introduction of the Salish Class natural gas-fuelled vessels which are cleaner and less costly to operate. We are well on our way to building a standardized, interoperable fleet which will reduce costs, improve our environmental footprint and further increase safety,” said Collins. “Starting later this year, we will convert the Spirit of British Columbia and the Spirit of Vancouver Island – the largest vessels in our fleet – to cleaner, less expensive natural gas.”
Capital expenditures in the 12 months ended March 31, 2017 were $243.7 million.
For fiscal 2017, these expenditures include:
- $177.1 million in vessel acquisitions, upgrades and modifications
- $30.9 million in information technology
- $22.9 million in terminal marine structures and
- $12.8 million in terminal and building upgrades and equipment
BC Ferries’ full financial statements, including notes and Management’s Discussion and Analysis, as well as the company’s Statement of Executive Compensation for fiscal 2017, are filed on SEDAR.
