The Anchorage, Alaska-based state-owned railroad reported operating revenue of $163.4 million in 2018, down from $165.2 million the year before. Net income dropped from $22.4 million to just under $18 million.
The railroad said revenue from the freight business, its largest segment, was virtually unchanged from year to year. A drop in hauls of gravel and petroleum products was offset by increased shipments in its rail-barge business, and military movements.
On the passenger side, the number increased 5 percent and revenue added 10 percent. The total passenger count was 531,611.
Results were also influenced by gains in its real estate operations and grants intended for 2016 but received in 2017. The railroad also had to deal with several incidents of weather damage and the continuing effort to install positive train control on its system.
The railroad said in a statement the 2018 results represent “real performance gains over 2017.”
Alaska Railroad employs about 550 year-round, and adds another 130 to 140 in spring for summer tourism season and for construction.
You can access the full Alaska Railroad 2018 annual report on line. It’s just under 80 pages and makes for a very thoughtful read. Go to https://www.alaskarailroad.com/corporate/leadership/reports Click on the reports list and select 2018. You’ll get a very interesting pdf.
Among the notable items ARR passenger service was notably profitable, even after depreciation is accounted for. No direct grant funds flowed to the passenger business line, although it obviously benefited from PTC investments from Federal, and state appropriations and grants and ARR bond monies. Revenue topped $38,895,00, with expenses of $14,500,000. Passenger equipment is largely depreciated and was assigned only $100,000 for the year.
Indeed the ARR is adding off-season passenger trains. The once twice monthly Anchorage to Fairbanks Aurora is now operated every weekend and on 24 midweek dates as well.
Of course the ARR situation is unique with its extraordinary summer season cruise and tour passenger demand, but it is not unimaginable that some of this might be replicated in areas like the Colorado Rockies, the California coast and possibly in the Pacific Northwest. The ARR even offers a superb dining car service using a concession structure to eliminate their risk.
So here perhaps is the exception that (? proves the rule). It is possible to run passenger service on a government owned railroad that does not require deep subsidy for either food or people? Is it? At least last year it looks true.
We don’t know if this covers the cost of capital, nor how much grant funding was provided in previous years. But I can say from personal experience that seeing what on one date I photographed and rode in 2010 was a packed train to Denali with 22 cars, including 19 domes, was a true site for sore eyes.
Carl Fowler
With a link to Russia and the US mainland,The Alaska Railroad would be sitting pretty.