BC FERRIES RELEASES YEAR-END RESULTS

COVID-19 pandemic had significant impact

VICTORIA, BC, June 24, 2022 /CNW/ - Ferries' traffic, revenue, net earnings and expenditures are all up, however the financial results for the fiscal year ended March 31, 2022 (fiscal 2022) are still lagging behind pre-pandemic levels.

During the year, BC Ferries carried 17.9 million passengers and 8.5 million vehicles, an increase of 37 per cent and 26 per cent, respectively, compared to the prior year. While these increases are significant, passenger and vehicle traffic were 20 per cent and 5 per cent lower respectively, compared to the same period in fiscal 2019, a pre-COVID 19 year.

"As we emerge from the pandemic, we are grateful to our employees for their commitment to put safety first, operate in the public interest, and ensure reliable ferry travel," said Mark Collins, BC Ferries' President and CEO. "We are excited to see people travelling with us again and are adding staff to meet the increase in demand for our service."

In the year ended March 31, 2022, BC Ferries experienced a net loss of $68.2 million prior to recognizing Safe Restart Funding. After recognizing $102.3 million of this federal-provincial funding, net earnings were $34.1 million, an increase of $13.1 million compared to the previous year, which included $186.0 million in Safe Restart Funding.

In December 2020, BC Ferries received $308 million through the Safe Restart Program, a federal-provincial initiative intended to help provinces and territories safely restart their economies.  Assistance to the public transportation sector, including BC Ferries, has been a critical part of the BC Safe Restart Plan. Without this funding, BC Ferries would have recorded a total loss of $233.2 million over the past two years ($68.2 million in fiscal 2022 and $165.0 million in fiscal 2021). The operating relief component of the Safe Restart Funding BC Ferries received has now been exhausted. The company does not foresee the need for any further COVID relief funding.

In fiscal the year ended March 31, 2022, revenue was $965.4 million, an increase of $100.1 million or 12 per cent compared to the prior year, primarily as a result of higher traffic volumes and net retail sales, partially offset by lower Safe Restart Funding.

Operating expenses in fiscal 2022 were $868.0 million, an increase of $88.2 million or 11 per cent compared to the prior year. This increase is mainly due to increases in the number of sailings provided, staff required to provide more service, fuel and maintenance expenses.

Despite the pandemic, BC Ferries continued to make significant investments in new vessels, vessel upgrades, terminal infrastructures and information technology. Capital expenditures for fiscal 2022 totalled $171.3 million, up from $122.0 million in the prior year. BC Ferries continues to modernize the fleet and reduce its carbon footprint with the introduction of new ships. During fiscal 2022, four more battery-electric hybrid Island Class vessels and one more liquefied natural gas-fuelled Salish Class vessel were delivered to BC Ferries.

BC Ferries' full financial statements, including notes and Management's Discussion and Analysis, are filed on SEDAR and will be available at www.sedar.com. 

Media Contact: BC Ferries, Media Relations Victoria:    [phone]

Customer Contact: Victoria:    [phone] Toll-free:   1-888-BCFERRY (1-888-223-3779)

BC Ferries is one of the largest ferry operators in the world based on passengers transported annually and transportation infrastructure, and carried 17.9 million passengers and 8.5 million vehicles during the fiscal year ended March 31, 2022. BC Ferries provides frequent year-round ferry transportation services to the west coast of Canada on 25 routes, currently supported by 39 vessels and 47 terminals, and also manages other remote routes through contracts with independent operators.

FORWARD LOOKING STATEMENTS 

This news release contains certain "forward looking statements". These statements relate to future events or future performance and reflect management's expectations regarding our growth, results of operations, performance, business prospects and opportunities, financial and business risks, and industry performance and trends. They reflect management's current internal projections, expectations or beliefs and are based on information currently available to management. Some of the market conditions and factors that have been considered in formulating the assumptions upon which forward looking statements are based include traffic, the value of the Canadian Dollar relative to the US Dollar, fuel costs, construction costs, the state of the economy, financial markets, demographics, the requirements of the Coastal Ferry Services Contract, and the impact of the COVID-19 pandemic.

Examples of forward looking statements included in this release include, but may not be limited to, statements with respect to: staffing requirements and capital investment initiatives. In some cases, forward looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue" or the negative of these terms or other comparable terminology. A number of factors could cause actual events or results to differ materially from the results discussed in the forward looking statements. In evaluating these statements, prospective investors should specifically consider various factors including, but not limited to, the risks and uncertainties associated with: vendor non-performance, capital market access, interest rates, foreign currency, fuel price, and traffic volume fluctuations, the implementation of major capital projects, security, safety, and environmental incidents, confidential or sensitive information breaches, changes in laws, vessel repair facility limitations, economic regulatory environment changes, tax changes, and Indigenous rights and claims.

Actual results may differ materially from any forward looking statement. Although management believes that the forward looking statements contained in this release are based upon reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward looking statements. These forward looking statements are made as of the date of this release, and British Columbia Ferry Services Inc. assumes no obligation to update or revise them to reflect new events or circumstances except as may be required by applicable law.

NON-IFRS MEASURES
In addition to providing measures prepared in accordance with International Financial Reporting Standards (IFRS), we present certain financial measures that do not have any standardized meanings prescribed by IFRS and therefore are unlikely to be comparable to similar measures presented by other companies. These supplemental financial measures are provided to assist readers in determining our ability to generate cash from operations and improve the comparability of our results from one period to another. We believe these measures are useful in assessing operating performance of our ongoing business on an overall basis.

SIGNIFICANT EVENTS FISCAL 2022

Significant events during fiscal 2022 or subsequent to the period include the following:

General

• BC Ferries is closely following the COVID-19 directives and guidance provided by the Province and Transport Canada. On June 15, 2021, the Province lifted travel restrictions imposed on April 23, 2021, which denied travel to customers travelling for non-essential reasons on routes crossing regional zones. Effective as of March 11, 2022, BC Ferries removed the mandatory mask policy to align with the directive from the Provincial Health Officer. Wearing face coverings is encouraged, but not required in, indoor public spaces.
• On April 1, 2021, BC Ferries implemented average tariff increases of 2.3 per cent in accordance with the British Columbia Ferries Commissioner's Order 19-04 dated September 30, 2019 and in accordance with the Safe Restart Funding Agreement.
• On November 5, 2021, BC Ferries launched its COVID-19 Vaccination Policy for all employees. Ship-based employees were required to be fully vaccinated by January 24, 2022 and all other employees by February 28, 2022.
• Effective June 1, 2022, a surcharge of 2.5 per cent was implemented on all routes due to rising fuel costs. A fuel surcharge of 1.0 per cent was introduced on March 1, 2022 on all routes except the Northern Routes. On the Northern Routes, the 1.5 per cent fuel rebate, which had been in place since April 1, 2020, was removed effective March 1, 2022.
• On June 20, 2022, the B.C. Ferry Authority appointed six new board members to the British Columbia Ferry Services Inc. Board to replace six board members who have concluded their time on the board.

Capital Assets

• On March 3, 2022, the Salish Heron arrived in Canada from Remontowa Shipbuilding S.A. in Gdansk, Poland sailing more than 10,400 nautical miles. The Salish Heron is identical to the three existing Salish Class vessels, which are dual-fuel capable, designed to run primarily on LNG, a cleaner and lower carbon-intensity option. The vessel has the capacity to carry approximately 138 vehicles and up to 600 passengers and crew. This fourth Salish Class vessel entered service on May 6, 2022 and will replace the 57-year old Mayne Queen, a diesel-fuelled vessel.
• BC Ferries received four new Island Class vessels on July 22, August 13, September 27 and December 21, 2021 respectively. All of the four new vessels are scheduled to enter service in 2022 and will bring the fleet total of Island Class vessels to six. The new vessels are outfitted with hybrid diesel-electric propulsion and have the capacity to carry 47 vehicles and up to 400 passengers and crew.
• On April 12, 2022, BC Ferries introduced two-ship service on the Nanaimo Harbour – Gabriola Island route, providing enhanced vehicle and passenger service to these communities. This augmented service using two of the four new Island Class vessels results in increased capacity and sailing frequency.

SOURCE British Columbia Ferry Services Inc.

Media Contact: BC Ferries, Communications, Victoria: [phone]; Customer Contact: Victoria: [phone], Toll-free: 1-888-BCFERRY (1-888-223-3779)