August 2021 Amtrak Financial Report

These are the items that I noticed in the report that were interesting to me:

• The report was dated September 28, 2021, but it was not posted on the web page until October 11, 2021.  This is an unusual delay in posting.

• The NEC generated for the first eleven months cash operating loss of $406.0 million (as determined by their accounting system) and the remainder of the system had a fully allocated cash loss of $547.0 million. Combined, the entire system had a cash operating deficit of $953.0 million for the period.

• For the eleven months, the NEC made debt service payments totaling $96.2 million and capital expenditures of $1.2 billion.  Counting all capital sources, the NEC Account has a balance of $1.4 billion as well as the cash reserves from previous years.

• For the rest of the National System, $49.4 million was needed for debt service and $768.2 million was spent on capital expenditures. The National Network account balance is now $1.4 billion in addition to the accumulated surplus from previous years. 

• The amount of money appropriated for the combined NEC and National Network for the first eleven months was $5.0 billion.  Amtrak has also received from other capital sources $879.3 million for the entire system. 

• The combined accumulated reserves at the beginning of the fiscal year totaled $409.1 million in cash and cash equivalents, $170.0 million in short-term investments, and $2.4 billion in available-for-sale securities. This brings total cash reserves as of October 1, 2020, to $2.9 billion. The current ratio (Current Assets divided by Current Liabilities) was 2.169 which would make Amtrak quite creditworthy for any fresh borrowings.

• In October 2020 Amtrak's burn rate (Operating Revenues-Minus Operating Expense-Minus Debt Service-Capital Expenditures) was $216.4 million. In November the burn rate was $238.6 million. In December the burn rate was $215.2 million. In January, the burn rate increased to $246.8 million. In February the burn rate was $251.0 million. In March, the burn rate was $225.5 million. In April the burn rate was $248.5 million. In May, the burn rate was $250.5 million. In June, the burn rate was $451.4 million (due to much higher capital spending on equipment purchases). In July the burn rate was $571.1 reflecting a huge increase in Planning & Asset Development. In August the burn rate was $205.3 million helped in part by increased revenues from the sleepers and normalized capital expenditures.

• Capital Spending for the eleven months was: Engineering $552.8 million, Mechanical $313.9 million, Operations $128 million, Commercial and Marketing $0.6 million, ADA & Stations $173.5 million, Information Technology $92.4 million, Safety $16.6 million. Procurement $4.3 million, Acela 21 $218.0 million ($29.2 million in August.), Intercity Trainsets $138.5 million (an increase of $1.3 million in August), Planning & Asset Development $487.3 million ($23.6 million increase in August alone), and OVHD Adjustment of $3.9 million. 

• Because of the expected losses due to the COVID Pandemic, Amtrak prepared a forecast zero budget. Comparing the eleven months results, the GAAP loss is $26.5 million better than forecast, and the cash operating loss is $18.9 million better (which is an improvement of $21.7 million during the month of August.) 

• The number of product lines showing a measurable operating surplus for the period improved to nine.  The five with a surplus over $1 million were:

  •  Washington-Richmond $8.4 million

  • Illini $5.7 million

  • Washington-Norfolk $1.6 million

  • Washington-Lynchburg $1.5 million

  • Adirondack $1.1 million  

  • The four Virginia product lines generated a total gain of $4.7 million. (the Washington-Newport News while stabilizing. continues to show a very large loss.) The Auto Train actually showed a $100,000 profit for the year to date.

• Ridership for the first eleven months fell more than 5,628,400 from the comparable period in FY2020. For the year to date, it stands at 10,575,900 (Amtrak is back to reporting ridership to the nearest 100). In fact, the total number of riders in all of August was 1,748,900. The situation with the long-distance trains shows less of a loss of riders than the other product lines. The Palmetto lost its title of the greatest loser to the Crescent who clocked a -35.3% loss for the fiscal year. The Southwest Chief was second at a -32.2% loss. The Chief has been constrained by the limited consists. The lines that showed ridership gains were the Auto Train with a positive percent of 18.4%, The Cardinal at +5.4%, and the Sunset at +3.1%. It is no coincidence that all three ran their normal frequencies for all of FY2021. The Acela while improving slightly is still off by 53.6%.

• The bipartisan infrastructure bill is still stuck in the House. A vote was to occur no later than September 27, 2021, but is now scheduled for no later than October 31, 2021. It is being held hostage to the much larger partisan $3.5 trillion reconciliation bill being passed. However, at this point in time, that bill does not seem to be going anywhere.

• Congress did pass a short-term Continuous Resolution (CR) through December 3, 2021, for all 12 budget bills including THUD. At the same time, an increase in the Federal Debt Limit was approved that should cover borrowing through the same date. However, no effort appears to be made to pass any of the individual budget bills prior to that date, requiring an omnibus bill to cover the remainder of the year. In all fairness, the THUD probably needs the bi-partisan infrastructure bill to become law before the 2022 THUD bill can be voted on. This did not stop the chair of the Senate Appropriations Committee from releasing a draft of the 2022 THUD Bill. However, push back from the GOP indicates that this was not a bi-partisan effort and the bill is not likely to be passed in the immediate future. The bill gave Amtrak 2.7 billion (the same amount as the house) but increased the amount for the National System at the expense of the NEC. An earmark to the CRISI money appropriates $2.5 million toward the Kingston Station (mostly for additional parking).

• A contract has been signed for the construction of the North Portal Bridge. That is expected to be completed in 5.5 years give or take a couple of decades.

Steve Musen