11c. Presentation

Q1 2022 Financial Performance Briefing

Item No. 11c supp
Meeting Date: May 24, 2022
Port of Seattle
Q1 2022 Financial Performance Report
Commission Meeting

Key Highlights
Port lines of businesses are still recovering from the disruption caused by the
pandemic
SEA passenger growth is rebounding; forecasting 7.6% fewer passengers than
2019
Federal Relief grants continue to improve SEA's bottom line
Projecting a record 295 sailings and 1.26 million passengers in the 2022 cruise
season
Projecting operating expenses to be $4.7M favorable to the budget on a full-year
basis
Continuing to support investments aimed at regional economic recovery

2

Port Wide Financial Summary (YE Forecast)
Fav (UnFav)        Incr (Decr)
2020      2021      2022     2022     Fcst vs. Budget   Change from 2021
Variance
$ in 000's                          Actual      Actual     Fore cas t    Budge t        $           %          $          %
Aeronautical Revenues           297,909      317,513     385,706     394,963     (9,257)     -2.3%     68,193    21.5%
Airport Non-Aero Revenues      116,473      183,819     239,404     240,820     (1,415)     -0.6%    55,586    30.2%
Non-Airport Revenues            96,446      120,689     137,373     131,072      6,302      4.8%    16,685    13.8%
Total Operating Revenues   510,828            622,020   762,484           766,854            (4,370)    -0.6%  140,464   22.6%
Total Operating Expenses         408,681      364,656     494,450     499,146      4,696       0.9%    129,794    35.6%
NOI before Depreciation    102,147            257,364   268,033           267,708              325     0.1%   10,670    4.1%
Depreciation                     180,086      190,683     196,757     196,757         -        0.0%      6,074      3.2%
NOI after Depreciation       (77,939)     66,681     71,277           70,952              325      0.5%     4,596     6.9%
Operating Revenues are expected to be $4.4M below budget due to $77M in Federal Relief grants applied to offset
Aeronautical revenue requirements
Total Operating expenses are expected to be $4.7M below budget mainly due to delayed hiring and project
spending, offset by higher utility costs and capital to expense writeoff related to the Gateway Building project at
Fishermen's Terminal
Net Operating Income before Depreciation is forecasted to be $325K above budget

3

Aviation Division Financial Performance Summary
Business Highlights
Fo recast      Budget
Figures in $000s                                    YE 2022       YE 2022       Variance
Revenues                                                             Passenger level forecast slightly below
Aeronautical                             385,706     394,963       (9,257)           budget, 7.6% below 2019
Non-Aeronautical                        239,404    240,820
Total Revenues                       625,110    635,783     (10,672)        Aeronautical revenues below budget due
O&M expense                     396,831    397,622       791         to planned higher grant use
NOI                         228,279   238,160    (9,881)
Federal Relief                            118,794      98,000      20,794           Delay in Salty's and AMEX lounge
Concessions Relief                        21,419      21,419            -           openings  impacting non-aero revenues
NOI (after Federal Relief Grants)                 368,492     357,579       10,913
Key Measures                                                          Risks to O&M budget include payroll
Non-Aero NOI (in $000s)                110,779    114,047      (3,268)          vacancy, garage fire repairs, and
CPE ($)                                  14.44       14.82         0.38
Debt Service Coverage                       2.29        2.03         0.26           unplanned project costs to be expensed.
Other Information                                                            ADF target shortfall will be addressed by
ADF Balance (in $000s)                  446,426    464,000     (17,574)
Capital Spending (in $000s)                449,817     527,917      78,100            modifying funding plan and/or grant use
plan

4

Seaport Performance Summary
Fav (UnFav)             Incr (Decr)                                      Fav (UnFav)
2021 YTD 2022 YTD 2022 YTD   Actual vs. Budget    Change from 2021       2022     2022      Fcst vs. Budget
Variance                                                          Variance
$ in 000's                                       Actual      Actual     B udg e t         $          %          $           %         Forecast    B udg e t         $          %
Revenues
Maritime                                       9,539      10,511       9,969        542         5%        972        10%       67,920     59,137      8,783        15%
Economic Development Division                2,002      2,580      3,338       (758)      -23%        578       29%       14,470     18,769     (4,299)      -23%
Joint Venture*                                 10,988      13,982      11,975       2,007        17%       2,994        27%       47,899      47,899          0         0%
Total Revenue                               22,529     27,074     25,283      1,791        7%      4,545       20%     130,290   125,806      4,484        4%
Expenses
Maritime                                      10,937      12,729      14,013       1,283         9%       1,792        16%       58,862     57,865       (997)       -2%
Economic Development Division                4,049      5,049      5,775        726        13%       1,000       25%       25,332     28,301      2,969       10%
Joint Venture                                      382         322         355          33         9%         (60)       -16%         1,727       1,727           0         0%
Total Expense                                15,368     18,100     20,142      2,043       10%      2,732       18%      85,922     87,894      1,972        2%
NOI Before Stormwater Utility                 7,161      8,974      5,140      3,834       75%      1,813       25%      44,368    37,912      6,456       17%
Stormwater Utility Revenues                     1,545       1,680       1,692         (12)        -1%         135         9%        6,768       6,768          0         0%
Stormwater Utility Expenses                      1,123       1,199       1,530         331        22%          76         7%        6,266       6,266           0         0%
Stormwater Utility NOI                          422        481        162        319      197%         59       14%         502       502          0        0%
Total Non-Aviation Business NOI              7,583      9,455      5,302      4,153       78%      1,872       25%      44,871    38,415      6,456       17%
Year-to-Date                                              Forecast
Favorable timing of NWSA/Joint Venture income.                          Cruise expected to exceed revenue and passenger
Better than expected waterside occupancy at Maritime                   budgets.
terminals, piers and marinas.                                        Expected in Q2: $1.2M remaining Capital to Expense for
Gateway Building at Fishermen's Terminal.
Slow return of conferences and events.                                      Conference & Event Centers at 58% of budget.
Employee vacancies driving lower expenses.                               Joint Venture and Stormwater utility on budget.

5

Central Services
Financial Summary              Business Highlights
Port partnered with WorkSource to host the Job and
2022      2022                   Resource Fair for newly arrived Afghan refugees; 250
Figures in $000s           Forecast    Budget   Variance         people attended
Revenues                    334          186          148          Shared the results of the port-wide Equity Assessment
and Women of Color Assessment, the equity
Core Central Services          97,419            96,677        (742)
Police                         31,686            32,746       1,060         performance goal requirements, and the new hiring
Engineering/PCS              11,434            12,334        900            process requirements
O&M Expenses       140,538  141,756    1,218    Police Assessment Implementation Team (PAIT)
reviewed the 52 recommendations highlighted by the
Capital Spending             9,778     10,889       1,111        consultant (21 CP)



6

Port Wide Capital Spending

Total Q1 YTD capital
spending was $63M
For the full year, total capital
spending is expected to
be $494M, 85.9% of the
budget


7

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