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Comprehensive income

Revenue

Revenue for 2019–20 was $245.4 million, compared to $235.2 million for 2018–19, an increase of $10.2 million.

This increase was mainly from the reversal of a pollution incident provision of $11.4 million recognised in 2018–19. Other movements in revenue include increases in departmental appropriations (by $5.5 million), and a rise in levy revenue (by $3.2 million), partially offset by reductions in insurance recoveries (by $4.5 million), reduced contributions to the national system for domestic commercial vessel safety from jurisdictions (by $2.7 million), and lower fee-based revenue as a result of COVID-19 pandemic impacts on industry (by $2.5 million).

Figure 2 shows the sources of revenue for 2019–20, with levy revenue broken down into the main vessel classification drivers. In 2019–20, approximately 33.7 per cent of total revenue was levy revenue from iron ore and coal bulk cargo vessels, with 33.4 per cent from departmental appropriations.

Figure 2: Source of revenue for 2019-20 Pie graph of revenue sources. 52% levy revenue (10.8% iron ore, 13.9% coal, 7.4% general bulk cargo, 4.5% liquid product and gas, 6.4% others); 33.4% government appropriations; 4.8% pollution incidents and insurance recoveries; 4.3% contributions by states and territories; 2.6% sale of goods and rendering services; 2.9% other revenue

Levy revenue volumes

Figure 3 shows the total net registered tonnage of vessels contributing to levy revenue from 2015–16 to 2019–20, and the quantity (number of times vessels are liable for levies).

As illustrated, net tonnage has risen consistently from 290.8 million tonnes in 2015–16 to 323.2 million tonnes in 2019–20 (11.2% increase). Over this same period, the number of vessel visits liable for levies has also risen from 9,965 in 2015–16 to 10,529 in 2019–20, but at a lower rate (5.7%).

This is indicative that the size of vessels visiting Australian ports is increasing—the average net registered tonnage per vessel has risen from 29,792 tonnes in 2015–16 to 31,126 tonnes in 2019–20.

Figure 3: Levy revenue volumetric data A combination line and bar graph which shows the total net registered tonnage of vessels contributing to levy revenue since 2015-16. The actual net tonnage volumes have increased from 290 million to 323.2 million tonnes in 2019-20. The number of vessel visits liable for levies has rising from 9,965 in 2015-16 to 10,529 in 2019-20.

Operating expenses

Operating expenditure for 2019–20 was $242.4 million, compared to $255.7 million in 2018–19, a reduction of $13.3 million.

Figure 4 shows changes to suppliers, employee benefits, depreciation, and other expenses for 2019–20 actual, 2019–20 budget, and 2018–19 actual results.

Supplier expense in the current year were $124.5 million compared to $140.6 million in 2018–19 (net of one-off provision of $27.1 million recognised in 2018–19). This decrease of $16.1 million mainly represents the shift in rent expenditure (suppliers) to deprecation under the new accounting standard for leases.

Employee expenses increased by $5.1 million, corresponding to an increase in the number of staff and salary increments.

Depreciation increased by $22.5 million, driven by the shift of rent expenditure from supplier expenses.

Figure 4: Breakdown of operating expenses (AUD $,000) The bar chart shows the breakdown of AMSA operating expenses - 2018-19 actual, 2019-20 budget and 2019-20 actual), by suppliers, employee benefits, other expenses and depreciation and amortisation

Cash position

AMSA’s net cash position (including investments) as at 30 June 2020 was $89.7 million (2018–19: $109.7 million). This decrease of $20.0 million was mainly due to pollution clean-up operation expenditure of $15.7 million, with other operating and financing activities contributing $4.1 million.

Financial outlook

AMSA is budgeting for a marginal surplus in 2020–21 and break-even positions for the next two forward years (2022–23 and 2023–24). AMSA’s cash position is expected to decrease marginally as the provision for lead paint and asbestos remediation work is undertaken on our aids to navigation network during the next few financial years.

A rebuild of the strategic asset management framework is underway to ensure AMSA’s asset portfolio is managed with an optimal and efficient mix of assets to meet AMSA’s policy outcomes. This will provide insights into cash flow impacts for the asset replacement program for the next 20 years.

Risks in 2020-21

As Australia is offically in a recession, discretionary consumer spending is very likely to remain flat or contract in 2020–21, accompanied by a reduction in the quantity of imports and related vessels visiting Australian ports. This will likely result in a heavier reliance on bulk cargo vessels, in particular iron ore exports, to generate AMSA’s levy revenue.

AMSA will be working within the framework of the larger Commonwealth budgeting strategy to ensure that its regulatory services are delivered as efficiently and effectively as required to ensure compliance with maritime safety standards.