The Turks and Caicos subsidiary of Jamaican tourism attraction company, Margaritaville has incurred a net loss of US$1.07 million for the last three quarters.

This has come about as the business has slowed significantly given COVID-19 and the closure of the cruise shipping into the region as a result of the pandemic.

The losses incurred for the nine-month period ended February 28 this year has erased the operating profit of US$617,831 made during the corresponding period in 2020.

For the third quarter Margaritaville Turks net loss closed at US$261,014 relative to profit of US$172,520 in the previous comparable quarter. Operating loss for the third quarter totaled US$261,014 versus operating profit of US$172,520 reported in the prior corresponding period last year.

As a result, gross profit for the nine month period was nil when compared to US$4.36 million for the comparable period in February 2020. Gross profit for the third quarter closed at nil compared to US$1.46 million for the February 2020 quarter.

Revenues tumbling

For the period under review, revenues tumble to US$46,606 versus US$5.82 million in the prior corresponding period in 2020, representing a 99 per cent decline. For the third quarter, revenues declined by 100 per cent to US$6,155 coming from US$1.96 million in 2020.

The management has explained that, “the operating status of the company remains on pause since the last report of the November 2020 quarter. There were no cruises into the Grand Turk Port for the third quarter and as of today’s date, no confirmed timeline has been determined for the resumption of cruising to the port.”

Cost of sales decreased by 97 per cent for the nine-month period to $46,606 coming from US$1.46 million in 2020, while for the quarter there was a 99 per cent decrease to US$6,155 coming from US$493,644 in 2020. On the positive side, total expenses decreased by 71 per cent for the period under review to US$1.07 million coming from US$3.74 million in 2020.

This contraction was associated with an 80 per cent decline in administrative expense to US$659,239 compared to US$3.34 million reported in the previous comparable period. Notably, this was tempered by a 29 per cent growth in depreciation and amortization, which closed at US$219,280 from US$169,692 reported in February 2020.

No promotional expenses were booked for the period under review, whereas, for the quarter, total expenses closed at US$261,014, down from the US$1.29 million posted last year.

Hope resting on resumption of cruise shipping

The management has pointed out that, “since the commencement of vaccination in the last quarter, the Cruise Industry is in high gear….The location is in stand-by mode for commencement of cruising activities. All remedial work necessary has been identified and works plans prepared. We are awaiting timelines for commencement of cruising to schedule these necessary works.”

Margaritaville Turks as at February 28, 2021, recorded total assets of $4.18 million versus $6.09 million in 2020, a 31 per cent decline. This was due to a 100 per cent reduction in ‘Owing by related companies’ which closed at nil.

Trade and other receivables also contributed to the decline amounting US$94,349 coming from US$260,730 posted last year. Total Shareholders’ Equity as at February 28, 2021, closed at $3.23 million coming from the 2020 out-turn of US$5 million, which resulted in a book value of US$0.048.