I'm adding an analysis of Brightline's (probable) financial performance for Q4. Obviously we do not have financial results for December yet (if I had those, I'd probably have a lot more information on other stuff than I do now...), but I'm comfortable extrapolating the third month on the basis of the first two and then adjusting. I'm simply going to bump December up by 10% in terms of ridership and ticket revenue from November - there's an extra day (so, +3% by default) and the holidays, but also no Polar Express-type stuff.
Operating expenses are indicated at $46m in the filing, and the filing indicates another $7m in ongoing capex, for total costs of $53m.
These results put Brightline in the red for Q4, but "only" by $4m vs operating expenses or $11m vs operating expenses plus capex. Obviously, this isn't enough to allow for debt service, but I'm willing to be optimistic that adding another car, if it allowed a 20% bump in ridership and revenue (so, $40.7m in ticket revenue/$50.4m in total revenue - I'm presuming no impact on load factors or traffic distribution, which is obviously not going to be the situation but I also can't really model things any more closely on the fly) would cover operating costs and the other cars would put them over the top on both fronts (add $6.8m in ticket revenue/$8.4m in total revenue for each car added to the sets, so $47.5m/$58.8m in revenue at six cars and $56.3m/$67.2m in revenue at seven cars).
Some other simple math: Each of those levels would annualize out (i.e. multipliy by four) to something like this:
Four cars: $136.4m ticket/$168.0m total
Five cars: $162.8m ticket/$201.6m total
Six cars: $190.0m ticket/$235.2m total
Seven cars: $225.2m ticket/$268.8m total
Versus expected costs for 2024, operating expenses are $220m and ongoing capital expenses are another $26-27m (so, $246-247m). That would put the line in the black on an operating+capex basis by about $20m/yr. Unfortunately, Brightline's debt service requirements are $263m/yr (albeit offset by a funding release in the first 2-3 years).
So, I reiterate my earlier view that barring a major change, Brightline is likely to have to reorganize its debts. Of course, there may be a path to those changes...it's just not clear from the ongoing ridership/revenue situation. I do expect the gap to close significantly over time, by the way - the commuter service will add track access fees IIRC, and there will also be other ancillary revenue from station food sales (though the impact on overall ridership and ticket sales is unpredictable and I'm still not buying that it won't have unanticipated impacts), and ticket prices should be able to rise a bit while the debt pile remains mostly static for the first few years (and as long as ticket prices can rise in line with or faster than expenses, that will help as well).
Edit: If I simply multiply the Q4 operating expenses by 4, that's $184m. Adding in 4x the capex gets you another $28m. That'd bring the overall costs down to $212m or so, providing a bit more headroom (about $57m in operating profits per year at seven cars). That's still nowhere near the projected need of $263m, but it's at least closer.
Code:
October - Actual
2023 October SD 126,059 3.1 $3,092,227 $24.59 $24.53
2023 October LD 79,686 7.3 $7,314,378 $91.61 $91.79
2023 October TOT 205,745 10.4 $10,406,582 $50.55 $50.58 12.8 $62.21
November - Actual
2023 November SD 112,423 2.9 $2,915,128 $25.79 $25.93
2023 November LD 93,184 8.4 $8,360,468 $90.14 $89.72
2023 November TOT 205,607 11.3 $11,275,488 $54.96 $54.84 13.9 $67.60
December - Estimate
2023 December SD 123,665 3.2 $3,206,641 $25.79 $25.93
2023 December LD 102,502 9.2 $9,196,515 $90.14 $89.72
2023 December TOT 226,167 12.4 $12,403,155 $54.96 $54.84 15.3 $67.60
Q4 Combined - Estimate
2023 Q4 SD 362,147 9.2 $9,213,996 $25.44
2023 Q4 LD 275,372 24.9 $24,871,361 $90.32
2023 Q4 TOT 637,519 34.1 $34,085,357 $53.47 42.0 $65.88
Q4 Combined - Brightline Filing
2023 Q4 SD 580,000 17.0 $16,889,600 $29.12
2023 Q4 LD 330,000 36.0 $36,098,700 $109.39
2023 Q4 TOT 920,000 53.0 $53,479,600 $58.13 64.0 $69.57
Filing Filing Derived Filing Filing DerivedOperating expenses are indicated at $46m in the filing, and the filing indicates another $7m in ongoing capex, for total costs of $53m.
These results put Brightline in the red for Q4, but "only" by $4m vs operating expenses or $11m vs operating expenses plus capex. Obviously, this isn't enough to allow for debt service, but I'm willing to be optimistic that adding another car, if it allowed a 20% bump in ridership and revenue (so, $40.7m in ticket revenue/$50.4m in total revenue - I'm presuming no impact on load factors or traffic distribution, which is obviously not going to be the situation but I also can't really model things any more closely on the fly) would cover operating costs and the other cars would put them over the top on both fronts (add $6.8m in ticket revenue/$8.4m in total revenue for each car added to the sets, so $47.5m/$58.8m in revenue at six cars and $56.3m/$67.2m in revenue at seven cars).
Some other simple math: Each of those levels would annualize out (i.e. multipliy by four) to something like this:
Four cars: $136.4m ticket/$168.0m total
Five cars: $162.8m ticket/$201.6m total
Six cars: $190.0m ticket/$235.2m total
Seven cars: $225.2m ticket/$268.8m total
Versus expected costs for 2024, operating expenses are $220m and ongoing capital expenses are another $26-27m (so, $246-247m). That would put the line in the black on an operating+capex basis by about $20m/yr. Unfortunately, Brightline's debt service requirements are $263m/yr (albeit offset by a funding release in the first 2-3 years).
So, I reiterate my earlier view that barring a major change, Brightline is likely to have to reorganize its debts. Of course, there may be a path to those changes...it's just not clear from the ongoing ridership/revenue situation. I do expect the gap to close significantly over time, by the way - the commuter service will add track access fees IIRC, and there will also be other ancillary revenue from station food sales (though the impact on overall ridership and ticket sales is unpredictable and I'm still not buying that it won't have unanticipated impacts), and ticket prices should be able to rise a bit while the debt pile remains mostly static for the first few years (and as long as ticket prices can rise in line with or faster than expenses, that will help as well).
Edit: If I simply multiply the Q4 operating expenses by 4, that's $184m. Adding in 4x the capex gets you another $28m. That'd bring the overall costs down to $212m or so, providing a bit more headroom (about $57m in operating profits per year at seven cars). That's still nowhere near the projected need of $263m, but it's at least closer.
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