Brent Pin­heiro

brent.pin­heiro@guardian.co.tt

Prime Min­is­ter Kam­la Per­sad-Bisses­sar has is­sued an ul­ti­ma­tum to the man­age­ment of lo­cal car­ri­er Caribbean Air­lines (CAL): ‘sort out the mess’ in two years or find a new job. Speak­ing at the UNC's Mon­day Night Re­port in Cou­va, Per­sad-Bisses­sar ac­cused man­age­ment of fail­ing to do its job, pay­ing $60 mil­lion to EY and Price­wa­ter­house­C­oop­ers (PwC) for au­dits de­spite a large in­ter­nal fi­nan­cial team, fail­ing to sub­mit au­dit­ed fi­nan­cial state­ments, and op­er­at­ing un­prof­itable routes.

Since 2023, Caribbean Air­lines has added sev­er­al new des­ti­na­tions to its route map, in­clud­ing Puer­to Ri­co, Mar­tinique, Guade­loupe, and Tor­to­la, as part of its 2023-2027 strate­gic plan - ap­proved by the then PNM gov­ern­ment. The air­line trans­port­ed over two mil­lion pas­sen­gers in both 2023 and 2024, but Per­sad-Bisses­sar in­sists that de­spite the num­bers, none of the routes are prof­itable. Al­though some routes have main­tained high pas­sen­ger loads, oth­ers have strug­gled. For ex­am­ple, a new Ja­maica ser­vice op­er­at­ing be­tween Kingston/Mon­tego Bay and Fort Laud­erdale has rou­tine­ly seen poor load fac­tors. Ac­cord­ing to the U.S. De­part­ment of Trans­porta­tion’s Bu­reau of Trans­porta­tion Sta­tis­tics, some months have seen the air­line trans­port on­ly 160 pas­sen­gers one way de­spite of­fer­ing 1,600 seats on a Boe­ing 737-800.

What is the fi­nan­cial state of Caribbean Air­lines?

CAL’s fi­nan­cial state has al­so been some­what of a mys­tery over the past few years. In 2021, Caribbean Air­lines it­self re­leased unau­dit­ed fi­nan­cial re­sults show­ing an op­er­at­ing loss of US$48 mil­lion for the first half of the year. The air­line said it was con­sis­tent with the same pe­ri­od for 2020, when it re­port­ed an op­er­at­ing loss of US$48.7m. At the time, it blamed some of the heavy loss­es on a 44.8% drop in pas­sen­ger num­bers as a re­sult of the COVID-19 pan­dem­ic that dec­i­mat­ed the trav­el in­dus­try.

But the air­line seemed to turn its so-called fi­nan­cial ship around. In a 2024 Cus­tomer Ap­pre­ci­a­tion Event, then Fi­nance Min­is­ter Colm Im­bert, who was al­so CAL’s line min­is­ter, said the air­line had moved from an op­er­at­ing loss of US$36 mil­lion, ex­clud­ing debt ser­vice, in 2022 to a 2023 op­er­at­ing prof­it of US$24 mil­lion, mi­nus debt ser­vice. How­ev­er, one year lat­er, Im­bert re­vealed an op­er­at­ing prof­it of just US$12.1 mil­lion in 2024 – a drop of 51 per cent. He at­trib­uted the de­cline to an in­crease in main­te­nance costs, han­dling costs, and se­cu­ri­ty flight op­er­a­tions.

Yet the num­bers came with a caveat. Im­bert ad­mit­ted his 2023 num­bers were pro­vid­ed by CAL and didn’t come from his min­istry – like­ly be­cause the air­line hasn’t sub­mit­ted au­dit­ed fi­nan­cial re­ports for the last nine years. A fact it ad­mit­ted to in re­sponse to a Free­dom of In­for­ma­tion (FOI) re­quest from UNC ac­tivist Ravi Bal­go­b­in. When asked why that was so, Im­bert told Guardian Me­dia, “My In­vest­ments Di­vi­sion has been writ­ing to Caribbean Air­lines for a long time. They had some is­sues with the au­di­tors, ap­par­ent­ly, so they get let­ters fre­quent­ly, and they have promised to do bet­ter and to bring the fi­nan­cials up to date.” Ac­cord­ing to the State En­ter­pris­es Per­for­mance Mon­i­tor­ing Man­u­al 2011, state en­ter­pris­es are re­quired to sub­mit an­nu­al fi­nan­cial state­ments/an­nu­al re­ports to the Min­istry of Fi­nance’s In­vest­ments Di­vi­sion and the ap­plic­a­ble line min­istry four months af­ter the end of the fi­nan­cial year.

Pressed on who was re­spon­si­ble for the de­lay, Im­bert said that he wrote to CAL’s chair­man, Ron­nie Mo­hammed, but ul­ti­mate­ly blamed it on CAL CEO Garvin Med­era, say­ing, “The CEO is the per­son who is even­tu­al­ly ac­count­able.”