Message from the President
Established in 1946, the Saskatchewan Transportation Company (STC; the Corporation) is a Crown Corporation of the province of Saskatchewan. STC is subject to The Crown Corporations Act, 1993, which provides the Crown Investments Corporation (CIC) of Saskatchewan, the holding company for Saskatchewan’s Crown corporations, the authority to establish the direction of the Corporation.
STC is a provincial coach company which provides safe, affordable and accessible bus passenger and freight service to Saskatchewan communities.
To provide Saskatchewan residents with CONVENIENT, AFFORDABLE, SAFE, CLEAN, COMFORTABLE, COURTEOUS, ENVIRONMENTALLY FRIENDLY
passenger and freight transportation services.
In many ways, 2012 was another successful year for STC. The company achieved high levels of customer satisfaction despite the ongoing changes in the industry. STC was also able to improve upon its employee satisfaction levels despite heavy workloads created by the challenging market conditions that make recruiting and retaining employees difficult in our booming province. However, unlike the previous years' results where ridership was growing, the negative effects of industry change caused a decline in ridership of 2.1 per cent when compared to 2011.
The changes to the Canadian bus industry began to have an impact on STC in late 2011. At that time, Greyhound Canada publicly announced significant reductions in scheduled service in Alberta. Further cuts were made in that province in early 2012, and by mid-2012 significant route reductions were implemented in Manitoba. The basis for these reductions was that the routes were no longer economically viable. As a result of these reductions, STC's connections became substantially less convenient for passengers or were eliminated altogether. This, in turn, reduced travel on STC’s network and, in an effort to be as efficient as possible, prompted STC to modify frequency of service on certain corridors and eliminate service to route end-points that were no longer viable.
Initial estimates were that ridership could be down as much as eight to 10 per cent in 2012 as a result of the lost connections in neighbouring provinces. During the first half of 2012, ridership was indeed down significantly. Over the course of the last half of the year, the Company successfully took steps to extend seat sales and run additional promotions to encourage ridership growth within our province, despite the loss of out‑of‑province connections.
Although STC finished 2012 with a drop in ridership of a little more than 2 per cent, we are encouraged by the responsiveness of the Saskatchewan marketplace to our sales and promotions. It is indicative of the opportunity that still exists for STC to continue to add ridership to its base. Furthermore, the passengers that are experiencing STC's service for the first time in years are very positive with their comments on the convenience, cleanliness and comfort of the service we provide. We believe there is still tremendous value in the service that STC offers.
STC continued to make inroads on key passenger demographics. STC supports youth and students, including aboriginal populations, as they obtain an education to meet our workforce requirements through transportation to educational institutions. Seniors have access to transportation for appointments or connections with family. People with medical conditions, young and old, ride with STC daily to access health services in our major centres. Increasingly, business people are riding with STC to remain productive during travel time by utilizing the Wi‑Fi on board. New citizens to Saskatchewan are a growing passenger demographic who find the provincial transportation network very valuable. STC also offers wheelchair accessible service and, as a result, offers a very important service to those that have little or no other options for travel. For all of these groups, the quality of life is positively impacted by the services provided by STC.
As with other forms of public transit, STC requires a subsidy to operate. STC's ratio of operating cash loss (which is generally equal to the annual subsidy required) to overall company expenditures is favorable when compared to other public bus transit services. STC's measure, as reported in the Balanced Scorecard later in this report, shows that STC currently requires about 37.8 per cent of its expenditures to be funded annually through subsidy. Looking at this another way, STC receives roughly one‑third of its revenue from passenger services, one‑third from freight services, and one‑third in the form of subsidy.
Regardless of the size of the subsidy, STC employees work every day to find opportunities to minimize our operating costs with the objective of lowering the overall subsidy. While the employees of STC are mindful of this financial objective, they are also committed to the Company's service mandate. That is, to provide safe, affordable and accessible bus passenger and freight services to Saskatchewan. In that regard, STC employees make every effort to ensure that our passengers are transported safely and are given the best experience possible when using our services. As an example, STC continued to invest in new fleet assets in 2012, and added amenities to coaches to ensure that our passenger's comfort and convenience is enhanced. STC completed the installation of Wi‑Fi on 100 per cent of its coaches in 2012.
STC's fleet investment strategies are carefully considered in order to minimize the amount of funding required. One of the ways in which the company achieved this in 2012 was through the acquisition of four pre‑owned coaches. These coaches were purchased at a significant cost savings when compared to the price of a new coach. Another initiative that was undertaken in 2012 for the first time in company history, was the refurbishment of an older coach in our fleet. The refurbishment is an opportunity for STC to efficiently extend the life of coaches with certain features that are not available on the used market. Without such a refurbishment, STC would be relegated to the position of buying new coaches at a significant premium. A second bus is planned for refurbishment in 2013.
STC serves a wide network of 287 communities in Saskatchewan. This could not be done without the mutually beneficial partnerships we maintain with the private sector. They, along with the staff at STC, work hard to ensure our customers have a safe and enjoyable experience and I am pleased to report that because of their efforts, 92.6 per cent of our passengers rated our service as "excellent" or "good". The stories that I hear on a regular basis about how our agents and staff will go out of their way, and often on personal time, to assist our customers that are in need, humble me. I can’t thank them enough for their efforts.
President & CEO