By Pacific Island Times News Staff Despite the coronavirus-triggered travel drought that stagnated air traffic and revenue flow, the Guam International Airport Authority posted financial recovery in 2021, courtesy of Covid-19 relief aid capital grants from the federal government.
According to the Office of Public Accountability, the airport authority
closed fiscal 2021 with an increase in net income of $1.6 million, which was an increase of $6 million from FY 2020’s net loss of $4.4 million.
"Income from operating grants from the federal government, the government of Guam, and miscellaneous sources increased 38.3 percent year-over-year from $16.1 million in FY 2020 to $22.2 million in FY 2021," OPA said, adding that a large chunk of the funding came from the Covid-19 Relief Act.
Due to low traffic, however, the audit found that the airport’s operating revenues continued to decrease in FY 2021 by $20 million from $43.2 million in FY 2020.
Guam anticipated more flights from Taiwan and other Asian markets last year following the launch of the vaccination and vacation initiative. The program, however, was disrupted by a new wave of Covid-19 infections triggered by the delta variant last summer.
The audit determined that facility and systems usage charges decreased by $12.2 million, followed by concession fees at $8 million. However, miscellaneous revenue increased by $826,000, of which $616,000 is revenue from the Department of Administration for Covid-19 reimbursement.
"Overall, approximately 27 percent of the airport’s total operating revenues, including passenger facility charge income, were derived from one airline customer in FY 2021. Similarly, a primary concessionaire also accounted for 21 percent of the total operating revenues in FY 2021," OPA said.
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OPA said for the first time in 10 years, the airport's operating revenues were not enough to cover operating expenses, which decreased from $41.1 million in 2020 to $34.5 million in 2021-- - the lowest since 2012. "The $5.8 million decrease in contractual services primarily contributed to the overall decrease in operating costs and expenses, followed by a decrease in materials and supplies expenses of $725,000," OPA said.
The OPA attributed the spending cut to the airport's austerity measures, such as procurement restrictions that authorized only essential supplies and services needed for its 24/7 operations.
"The airport continued measures implemented in FY 2020 and maintained designated essential personnel onsite at the airport to meet federal requirements," OPA said.
"Transitioning into 'new normal' operations to help mitigate the impact of the Covid-19 pandemic on the airport’s airline partners, concessionaires and other service providers required an elevated level of collaboration and communication with all stakeholders," OPA said.
OPA noted, however, that although there were no significant deficiencies in its compliance report, a separate management letter highlighted the airport’s increasing trend in doubtful accounts.
"The auditors recommended Airport management continue to monitor and reassess the sufficiency of its allowance for doubtful accounts based on the current economic conditions presented by Covid," OPA said.
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