CUC operating loss at $17M

Commonwealth Utilities Corp. board chair Miranda Manglona presides over a meeting yesterday at the CUC conference room. At the meeting, CUC chief financial officer Greg P. Cruz reported that CUC is at an operating loss of $17 million. Cruz also disclosed that they are seeing improvements from collections, billings, and demands from May to July this year. (FERDIE DE LA TORRE)

The Commonwealth Utilities Corp. is operating at a loss of $17 million and will fail to hit its projected $100 million revenue this year, according to CUC chief financial officer Greg P. Cruz yesterday.

There is still some good news, though. In his report to the board during yesterday’s meeting, Cruz said they are now starting to see improvements in collections, billings, and demands from May to July this year.

Based on what he has seen, Cruz does not expect CUC to exceed its numbers last year.

“We’re not [going to] come close to hitting approximately $100 million in revenues. We are definitely spending more,” Cruz told board members. He said the CNMI’s situation after Super Typhoon Yutu boosted CUC’s expenditures this year.

“We are definitely not [going to] hit our revenue projection that we started out with this year,” said Cruz, adding that CUC will also not hit the level of revenue generated last year.

Cruz said he is looking at probably falling about 10% below last year’s level in actual revenue.

With respect to the “good news,” Cruz showed a table showing an upward trend in collections, billings, and even demand, covering the periods May, June, and July this year.

In May, total collections from government, residential, and commercial customers reached $6.6 million. In June, it was at $6.7 million. In July, it’s at $8.5 million.

In billings, government, residential, and commercial customers were billed a total of $8.3 million in May, $8.2 million in June, and $8.7 million in July.

The demand for electricity in May was approximately at 22.1 million kilowatt-hour. In June, it was at 23.2 million kWh. In July, it was at 23.6 million Kwh.

On the water side, Cruz said that CUC sold 125.6 million gallons in May, 119.8 million gallons in June, and 128.1 million gallons in July.

“So, we are seeing improvements,” he said.

Cruz noted that the only area where they see a downslope in collections, billings, and demand is in the government accounts.

“But if you look at the residential customers [and] at the commercial customers, they are paying their bills, they are using more power, they are buying more water,” he said.

As far as hitting the revenue projection, Cruz said there are only two months remaining in the fiscal year, so it’s not going to happen.

However, CUC’s expenditures have pretty much normalized now, he said. In May, CUC was still catching up with some expenses, he said, but expenses dropped down to about $7 million in the two subsequent months of June and July.

“So I believe it kind of reached the…pre-Yutu conditions to where I don’t see us spending more,” Cruz said. “We’re back to the level where we were before the storm.”