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CPA falls short in revenue target
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Posted on Feb 16 1999
The Commonwealth Ports Authority has failed to generate the needed revenue last month to meet debt service coverage for its $53 million debt as income from operations continue to nosedive.
As of Jan. 31, 1999, the cash-strapped ports authority is short of $153,736 in servicing the airport bond. Likewise, it needs $27,705 to meet debt service requirement for the seaport bond for the same period.
With its sinking funds, the ports authority has planned to raise airport fees to be able to repay its $53 million debt. However, the proposal has been strongly criticized by various sectors in the community claiming that the timing is wrong.
As a result, the ports authority is studying the possibility of reducing by 15 the salaries of employees for one or two years to avoid massive layoffs in the financially troubled agency.
Since the Asian economic woes began 17 months ago, the island’s tourism economy has been battered by the regional crisis pulling revenues down and forcing many establishments out of business.
While Japan Airlines has increased its enplaned passengers by 30 percent, operating revenues declined by six percent in the aviation division or a total of $804,882 compared to the same period in 1998 due to continuous reduction in overall visitor arrivals as well as concessionaire and advertising fees.
However, due to the cost-cutting measures implemented by management and staff, the ports authority was able to save $11,176 last month from operating activities.
CPA incurred a net loss of $265,213 last month, a 15 percent improvement from the previous period. However, compared to December 1998, the net loss slightly increased by six percent.
In the seaport operations, the ports authority registered operating revenue amounting to $304,714 or a 15 percent decline covering the same period in 1998 brought about by the drop in wharfage fees and gross receipts revenue. Furthermore, revenue tonnage slid by two percent.
The seaport incurred some $80,932 in operating expenses, which is a 13 percent savings. Despite the slowdown in economy, the seaport continue to generate revenue as net income amounted to $210,793.
