Gautrain feels Covid-19 pinch
PARTNERS: GAUTENG GOVT, BOMBELA TAKE BIG HITS
Restrictions have seen ridership drop significantly when compared to pre-lockdown level.
The Gauteng provincial government and Bombela Concession Company (BBC) will both take multi-million rand “hits” because of low commuter patronage on the Gautrain caused by the Covid-19 lockdown.
JSE-listed Murray & Roberts (M&R) has a 50% stake in the BCC, which holds the 15-year concession for operating and maintaining the Gautrain.
M&R group investor and media executive Ed Jardim confirmed the group will take a financial hit because of low patronage.
He said the BCC carries the risk on actual revenue up to a certain level, and from this level up to the guaranteed level, the revenue gap is covered by the “patronage guarantee” of the Gautrain Management Agency (GMA) .
Jardim added that under the lockdown restrictions, ridership is down significantly from pre-lockdown levels “to the extent that actual revenue is below the level from which the patronage guarantee applies”.
“This shortfall between actual revenue and the level from which the patronage guarantee applies is carried by BCC,” he said. “Unfortunately, we are in a closed period and cannot provide any financial detail. Our results are out on 26 August, where we will provide detail on this matter.”
However, GMA CEO William Dachs said the province “paid R92 million more than budgeted for the patronage guarantee in the first quarter of the 2020/21 financial year and Bombela lost approximately R171 million in revenue”.
Dachs said the financial cost of the patronage guarantee for the 2018/2019 financial year was R1.64 billion. The cost of the guarantee for the financial year to 31 March is not yet available.
Provisions?
Dachs was guarded in his comments on whether the GMA has made any provision for the expected increase in the cost for the patronage guarantee in its 2020/21 financial year and, if not, where it will get the money to pay for it.
He said the GMA is engaging with the provincial Treasury on a revised budget and is monitoring the revenue coming from the system.
Dachs said during a “Public Transport in the Time of Covid-19” interview on CNBC Africa this week that between 55 000 and 60 000 passengers a day normally travel on the Gautrain, but this has declined to between 6 000 and 8 000 people a day “depending on people’s movements on the day”.
“We track our numbers daily and can draw a direct correlation between the [Covid-19] infection rate and usage. When infection rates spike, people stop using the trains,” he said.
“People are very responsive to what they perceive as the risk of going out. The weather is also a factor and a cold week impacts on us,” he said.
Dachs said despite the BCC taking the bulk of the Gautrain revenue losses, it is performing “really well”.
He said the Gautrain would normally have transported about four million people in the period from the end of March up to 20 July but had only transported about 12% of that.
People are responsive to the risk of going out.