July 2021 Amtrak Financial Report

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

• The report was dated August 31, 2021 but not posted on the web page until September 2, 2021.  

• The NEC generated for the first ten months a cash operating loss of $395.5 million (as determined by their accounting system) and the remainder of the system had a fully allocated cash loss of $514.5 million. Combined the entire system had for the period a cash operating deficit of $910.0 million.

• For the ten months, the NEC made debt service payments totaling $93.5 million and capital expenditures of $1.2 billion. Counting all capital sources, the NEC Account has a balance of $1.4 billion plus the cash reserves from previous years. The big jump in capital expenditures has to do with the Gateway Project. Sometime in either July or August, Amtrak purchased a property in Manhattan needed for the Project and this could be reflected in the jump.

• For the rest of the National System, $49.1 million was needed for Debt service and $705.3 million was spent on Capital Expenditures. The National Network Account Balance is now $1.5 billion plus the accumulated surplus from previous years. 

• The amount of money appropriated for the combined NEC and National Network for the first nine months was $5.1 billion.  Amtrak has also received from other capital sources $747.2 million for the entire system. The increase from other capital sources ($301.3 million in July alone) could reflect increased borrowing. If the property was purchased for the Gateway in July, there is a decent chance that some form of financing took place.

• The combined accumulated reserves at the beginning of the fiscal year totaled $409.2 million in cash and cash equivalents, $170,025 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 credit worthy 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 $250.4 million. In June the burn rate was $451.3 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.

• Capital Spending for the nine months was: Engineering $500.1 million, Mechanical $292.3 million, Operations $9.5 million, Commercial and Marketing $0.5 million, ADA $77.6 million, Real Estate Stations & Facilities $83.6 million, Information Technology $80.2 million, Safety $15.0 million, Procurement $3.0 million, Acela 21 $188.8 million ($23.0 million in July), and Intercity Trainsets $137.2 million (a decrease of $28.7 million in July), and Planning has been renamed Planning & Asset Development $463.7 million (A whopping $361.1 million increase in July alone). The notes refer to Planning as the Hudson Tunnel/Gateway project. Again, it could reflect the purchase of that property in Manhattan. Another new category is Other, OVHD Adjustment of $3.9 million. All this reflects on exactly what kind of accuracy Amtrak is putting out in these financial reports. 

• The GAAP Loss for the fiscal year to date appears to be $1680.5 million which is $396.3 million worse than the same period in FY2020.  The cash operating earnings for the year was $355.0 million worse than FY2020.

• Because of the expected losses due to the COVID pandemic Amtrak prepared a forecast zero budget. Comparing the nine months results, the GAAP loss is $19.8 million better than forecast, but the cash operating loss is $2.8 million worse (which is a reduction of $43.1 million during the month of July). 

• The number of product lines showing a measurable operating surplus for the period is still at seven. The four with a surplus over $1 million were:

  •  Washington-Richmond $8.4 million

  • Illini $5.4 million

  • Washington-Norfolk $1.4 million

  • Adirondack $1.0 million  

  • The four Virginia product lines generated a total gain of $3.0 million. The Washington-Newport News product line while stabilizing continues to show a very large loss.

• Ridership for the first ten months fell more than 6,788,600 from the comparable period in FY2020. For the year to date, it stands at 8,827,000 (In an effort to promote greater transparency Amtrak now rounds to the nearest 1,000 rather than the nearest 100). In fact the total number of riders in all of July was 1,825,000. The situation with the long-distance trains shows a less of a loss of riders than the other product lines. The Palmetto was able to retain its title of the greatest loser at -42.3% for the fiscal year. Runner up was the Crescent at -40.6%. The line that actually showed a gain was the Auto Train with a positive percent of 11.5%. The Cardinal was off only 2.0% but because of rounding it may actually be even. The Acela while improving slightly is still off by 63.2%.

• The bipartisan infrastructure bill was passed by the Senate and sent to the House. A vote there will occur no later than September 27, 2021. For Amtrak it would appropriate over the next 5 fiscal years $16.0 billion and authorize another $19.2 billion. It also has substantial sums for the three grant programs, Consolidated Rail Infrastructure and Safety Initiative (CRISI), Federal State Partnership for Intercity Rail Passenger and Restoration, and Enhancement. It also provides for a new grant program that help eliminate some grade crossings. All-together, the appropriations and authorizations for rail equal $93.1 billion. Many of the reforms (but not all of them) listed in the House version were also included.

• While the House did pass a Thud appropriation as part of its seven combined budget bills, there has been no bill released yet in the Senate. With the Budget Outline passed (as part of the Democratic Only) reconciliation package, we may now see the Senate releasing their versions of appropriations.

• CAF has released the final two Viewliner Sleepers. How soon they enter regular service is dependent on Amtrak management desires to increase long distance ridership. Based on their track record, expect these to enjoy views of the weeds at Hialeah.

Steve Musen