BBCI continues to run at a loss – annual report

…Govt-subsidised river taxis reduced minibus revenues

The Berbice Bridge Company Incorporated (BBCI) is running at a loss with the company experiencing minimalBerbice bridge growth in traffic and revenue, according to the directors in the 2015 Annual Report.

This has resulted in no dividends being declared for Common Shareholders that own the equity in the bridge, for the eighth successive year since operations of the Berbice Bridge was launched.

BBCI held its annual general meeting on Friday at the Guyana Cooperative Insurance Services (GCIS) building on Main Street, Georgetown. However, according to the annual report, which was seen by Guyana Times, even though the company recorded a loss of $167.4 million last year, this reflects a 30 per cent improvement when compared to the loss of $239.2 million in the previous year.

According to the Directors, this reduction in both traffic and revenue growth was significantly lower than projected at the planning stages of the Berbice Bridge project. It was outlined that revenues from tolls in 2015 had amounted to $1,343 million as against $1,342 million in 2014.

The report revealed that of the revenue generated, some 45.2 per cent were gained from cars, 16.16 per cent from freights, 9.29 per cent from minibuses, 10.73 per cent from medium trucks, 5.23 per cent from small trucks and 4.45 per cent from pick-ups, and remaining categories 8.89 per cent. The daily average revenue earned, the directors said, amounted to $3,682,212, a minor increase of 0.14 per cent over 2014.

“This minimal increase of below one per cent over the previous year was primarily due to minor increases in traffic for cars, motorcycles and large trucks. Once again, a sharp decline was observed in traffic for minibuses and ocean-going vessels, along with a decline in all other categories, inclusive of freight,” the report stated.

However, it was explained that BBCI in December last year had entered an agreement with the Government, which saw the State paying a commuters’ subsidy to reduce the Bridge toll for passenger cars and mini-buses from $2200 to $1900 and for all other types of vehicles by 10 per cent, excluding vessels.

“This was done on the premise that both parties would engage shortly after implementation of the said agreement on January 1, 2016 in discussion on mutually beneficial arrangements in relation to tolls, since these were to be increased as per the toll formula,” the report stated. It is uncertain if this meeting occurred.

Moreover, the BBCI directors pointed out that Government’s introduction of a “subsided” River Taxi System in September 2015 for passengers only from Rosignol Stelling to New Amsterdam, would have contributed to the significant decline in minibus traffic across the Bridge, which amounts to some six per cent over the period September 21 to December 31, 2015.

In addition, the report stated that the non-interest expenses before amortization and depreciation for 2015 was $276 million compared to $292 million in the previous year. This decrease of five per cent was as a result of no dredging operations being required last year.

The directors added too that BBCI’s earnings before interest, tax, depreciation and amortization (EBITDA) was $1.072 billion, an increase of two per cent from 2014. However, the company’s total assets decreased from $6.7 billion to $6.5 billion in 2015, reflecting a decrease of 2.60 per cent over 2014, which was due mainly to continued amortization of concession assets, increases in property, plant and equipment, inventory and cash and cash equivalents.

Additionally, the report outlined that capital expenditures for the year included the construction of a jack-up barge, a new scale for the eastern end of the bridge and a standby generator set, which are work-in-progress.