Margaritaville Turks goes a year without revenueSunday, May 02, 2021
BY DAVID ROSE
WITH no cruise ships arriving at the Grand Turk Cruise port in over a year, Margaritaville (Turks) Ltd (MTL) is reporting that it incurred a third-quarter US$261,014 ($39.2 million) loss, with its cumulative loss for the nine months to February 28 totalling US$1.1 million ($159.9 million).
The company — which provides food, beverage, and entertainment services — has been one of the businesses most impacted by the novel coronavirus pandemic. The absence of the cruise ship industry and lack of general tourism have left the business to only record its inventory at cost to avert spoilage. As a result, MTL has only been recording expenses with no revenue to its name. Even with expenses being a fraction of their normal levels, the operating loss for the nine months stood at US$1.1 million, compared to the operating profit of US$617,831 generated before the pandemic.
With no incoming cash from normal business, MTL's parent company Margaritaville Caribbean Limited has fully repaid a related party balance of US$815,457 ($122.3 million) and advanced US$12,567 as MTL explores suitable financing options. MTL had US$9,612 of cash with no bank overdraft nor external debt at the end of the quarter.
Total assets declined by 22 per cent to US$4.2 million ($627.3 million) as MTL's current assets shrunk by 47 per cent to US$1.1 million. Total liabilities fell by eight per cent to US$953,959 while equity decreased by 25 per cent to US$3.2 million.
Even with the increased levels of vaccinations and relative reopening of global markets, the report, which was signed by Ian Dear and John Byles, stated: “The location is in standby mode for commencement of cruising activities. All remedial work necessary has been identified and work plans prepared. We are awaiting timelines for commencement of cruising to schedule these necessary works.”
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