WSC cash flow ‘devastated’ by COVID-19, collections down 25 percent

WSC cash flow ‘devastated’ by COVID-19, collections down 25 percent
Chairman of the Water & Sewerage Corporation, Adrian Gibson.

NASSAU, BAHAMAS — Water and Sewerage Corporation’s (WSC) chairman Adrian Gibson revealed it is ‘highly likely’ that the corporation will be challenged to meet its $2 million monthly payroll without government intervention if COVID-19 circumstances persist.

During his contribution to the 2020/2021 budget debate, Gibson said the pandemic has dealt a ‘devastating blow’ to the corporation.

Last month, WSC collected $2.4 million, a considerable drop from the $3.8 million collected in May 2019.

“The corporation is struggling to meet future payments to reverse osmosis providers, vendors and debt service requirements,” Gibson said.

“It is is highly likely that the longer current circumstances persist WSC’s monthly payroll of $2 million will be impacted and WSC will be challenged without government intervention to meet staff payments,” he said.

Gibson noted that although the corporation receives government subsidies from the government, due to a large shortfall, revenue has been used to make vendor payments.

“Our lost revenue due to the decision not to disconnect due stands at approximately $3.8 million per month,” he said.

Gibson noted that it is anticipated that 60 percent of WSC customers either due to unemployment or underemployment will be unable to make payments amounting to a $11.4 million over the next six months.

Gibson said that at the end of 2019 WSC had an operating revenue of $51.5 million, $52 million in 2018 and $50.6 million in 2017.

“In 2020 we expect it to be much less,” he said.

“COVID-19 has dealt a devastating blow to the corporation’s cash flow. That cash flow was already on a downward spiral due to the impact of hurricane Dorian and the loss of our second largest revenue base. Year to-date  collections have decreased from $29.8 million in June 2019 to 22.5 million in 2020 representing a 25 percent decrease.

Gibson noted that in New Providence collections to date are down by 20 percent  and down by 50 percent in the Family Islands.

In Abaco, he said the corporation’s cash flow has decreased by more than 90 percent with anticipated losses in 2020 of some $2.6 million.