By Ron Rocky Coloma
Despite the devastation wrought by Typhoon Mawar last year, the Port Authority of Guam has demonstrated resilience and fiscal strength, achieving a net gain of $4.6 million in fiscal year 2023.
According to the Office of Public Accountability's audit report released last week, the port continued to recover from the economic impact of Typhoon Mawar. Efforts are ongoing to repair the damage caused by Mawar and to sustain the port's operations.
Ernst and Young LLP, the independent auditors, issued unmodified opinions on the port authority's fiscal year 2023 financial statements and its report on compliance for major federal programs.
Fiscal 2023 concluded with the port authority’s net position rising to $31 million, up from $26.4 million in fiscal 2022, despite a $1.6 million operating loss, OPA reported.
This increase was driven by adding back the $6.2 million non-cash expense of depreciation to the $4.6 million operating income.
The authority also received $4.4 million in net non-operating revenues and $1.8 million in U.S. government capital grants.
Despite the challenges posed by Typhoon Mawar, the port's operating revenues increased by $2.9 million, reaching $60.6 million in fiscal year 2023 from $57.7 million in fiscal year 2022.
This growth was primarily driven by increased equipment and space rental and cargo throughput charges.
Equipment and space rental revenue increased by $981,000 due to higher demurrage fees charged to shipping agents, despite extending the free storage period to local businesses and industry partners due to Mawar.
The port handled 86,000 containers in fiscal 2023, reflecting a 3.8 percent decrease from fiscal year 2022’s 89,000 containers. However, non-containerized cargo rose significantly by 52 percent, from 141,000 tons in fiscal year 2022 to 215,000 tons in fiscal year 2023.
This increase contributed to a $303,000 rise in cargo throughput charges, with breakbulk, roll-on/roll-off cargo, cargo on chassis and overstowed containers seeing significant gains.
Other operating income rose by $1.6 million due to insurance claim proceeds from Mawar-related damages, while wharfage charges and special services revenue also saw modest increases.
These gains were slightly offset by a $98,000 decrease in crane surcharge and an $85,000 reduction in bad debt expense.
The port's operating expenses rose by $1.5 million, from $60.7 million in fiscal year 2022 to $62.2 million in fiscal year 2023.
The OPA attributed the increases to higher pension costs, with significant rises in management and administration, terminal service, transportation services, equipment maintenance and utilities expenses.
However, retiree healthcare and other benefits expenses decreased by $1.9 million, and general expenses fell by $1.5 million due to the completion of infrequent projects from fiscal year 2022.
The authority disclosed a net pension liability of $73.4 million and other post-employment benefits liability of $90.4 million as of Sept. 30, 2023. These liabilities represent 69 percent of the port authority’s total liabilities.
The port authority’s capital assets totaled $121.6 million, net of accumulated depreciation, making up 41% of total assets.
New assets and construction activities worth $15.4 million were added in fiscal year 2023.
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