SUPER TYPHOON YUTU’S FINANCIAL IMPACT
The devastation caused by Super Typhoon Yutu last October greatly affected the Commonwealth Utilities Corp.’s revenues, resulting in a shortfall of $7.2 million—a 26-percent drop in revenue for the first quarter of fiscal year 2019.
During Thursday’s CUC board meeting, the utilities agency’s acting chief financial officer, Corina Magofna, gave a PowerPoint presentation on the financial impact of Yutu that struck Saipan and Tinian last Oct. 24 and 25.
Magofna said the projected revenue for the first quarter of fiscal year 2019 was $27 million. However, CUC’s sales, as a result of the typhoon, only earned $20 million—a shortfall of $7 million.
Magofna said CUC’s expenses also went up as a result of Yutu, particularly personnel.
The projected personnel expenses for the first quarter was $4.8 million, but actual expenses reached $6.2 million—an increase of $1.4 million.
Magofna said this is due to overtime and change in pay rates because of the typhoon and restoration efforts.
Typhoon-related labor expenses will be reimbursed by the Federal Emergency Management Agency.
For operating expenses, CUC only spent $12.5 million out of the projected $20.9 million due to Yutu.
“All operations efforts were diverted to restoration,” Magofna said.
As CUC moves into the next quarter of fiscal year 2019, Magofna said personnel expenses will show a decrease because restoration efforts are nearing completion.
However, she said, operating expenses will show a significant increase because invoices are now starting to trickle in.
She said Capital Improvement Projects will resume gradually and expenses will reflect accordingly.