Amidst the coronavirus (COVID-19) pandemic, Arawak Port Development Limited (APD) reported a 14 percent increase over budgeted numbers in its third quarter (3Q) revenues, 13 percent more than the same period last year. It added that it expects a significant downturn for the remainder of the year and a potential revenue reduction due to expected economy shrinkage of up to 20 percent.
In a statement on its third quarter financial results, APD President and Chief Financial Officer Dion Bethell said the numbers were favorable amidst the COVID-19 pandemic.
“While our financial results as of March 31, 2020 are favorable and performing above budget and over prior YTD (year-to-date) March 2019 results, the reality of the economy and financial performance for April/May 2020 is very different from YTD March 2020,” Bethell said.
“We continue to evaluate information from global and local sources concerning COVID-19, with the intent of having our facilities continue to operate at optimum levels in a manner that will not affect trade, while ensuring a high level of awareness and efficiency.”
According to APD’s statement, net income in the third quarter was $7.9 million, 41 percent higher year-on-year.
It also added that EBITDA (earnings before interest, taxes, depreciation, and amortization) in the third quarter was $11.7 million, which APD stated was about $2.5 million or 28 percent higher than “the budgeted EBITDA of the same period”.
“Total operating expenditure was $13.8 million compared to the YTD 3Q 2019 expenditure of $13.1. Total operating expenses were approximately $700,000 or 5 percent more than the same period last year,” the statement noted.
“TEU (twenty-foot equivalent unit) volumes YTD 3Q 2020 were 8 percent higher than 3Q 2019, tonnage volumes YTD 3Q 2020 were 33 percent higher than 3Q 2019 and vehicle volumes YTD 3Q 2020 were 13 percent higher than 3Q 2019.”
The statement noted that TEU volumes were higher than expected because of development projects like The Pointe project, the Goldwyn project, Sterling Group’s Hurricane Hole development, the U.S. Embassy project and Dorian-related reconstruction material.
However APD reported that April’s import volumes of 3,620 TEUs volumes was a decline of 38 percent compared to the budgeted volume of 5,759 TEUs. The reason APD cited was the stall in those construction projects due COVID-19.
“We anticipate May results will be similarly affected, with volumes improving slowly over the next several months,” the statement noted.
“Overall breakbulk terminal revenues YTD 3Q 2020 were $1.81 million or 11 percent ($176,716) higher than the budgeted revenue of $1.6 million and approximately $121,382 or 7 percent more compared to YTD 3Q2019.
“Bulk terminal revenues YTD 3Q 2020 were approximately $263,487 or 32 percent more than the same period last year.”
Due to the economic impact of COVID-19, APD enacted an economic impact plan (EIP) on March 23, 2020, which reduced port fees by 50 percent for 30 days.
“These are unprecedented times and uncharted waters, we must ‘trim our sails’ given that we don’t know what the weather is like ahead and how long this global crisis will last. The impact of unemployment, forecasted to be as high as 30 percent and the overall financial impact on our economy could be potentially devastating, but I am certain the ‘tides will turn’ and we will rebound,” said Bethell.