- Redfex, a company that operates red-light cameras in the US and Canada, says revenues are down as people drive less.
- In Pennsylvania, road construction has been halted amid the coronavirus pandemic, further hurting Redfex's revenue.
- For everyone else, though, less driving is fantastic news.
- Visit Business Insider's homepage for more stories .
Michael S. Williamson/The Washington Post via Getty Images
As Americans stay home to help slow the spread of the coronavirus, they're driving fewer miles.
That's great news for everyone: Air pollution is fallin g, crashes are down , and there's no blood-pressure inducing congestion.
Well, almost everyone. For the companies that operate drivers' most-hated devices red light cameras it's causing a headache.
Redflex, an Australian company that operates "traffic safety programs" in roughly 100 US and Canadian cities, warned that less traffic and suspended construction amid the pandemic will be a stress on its balance sheet.
"Approximately 15% of group revenue is dependent on volume-based contracts," the company said in a regulatory filing Monday first spotted by The Wall Street Journal , hinting at its business line that includes enforcement cameras. "We anticipate our revenue from these contracts will be impacted broadly in line with the reduction in traffic volumes as well as the duration of the disruption."
Shares of Redflex, which trade in Australia, are down 46% since the beginning of the year.
On a call with investors Monday, Redflex CEO Mark Talbot warned that further travel restrictions could delay new installations and therefore impact revenues.
"So far, there have been no terminations to contracts," he said, according to a transcript compiled by Sentieo. "We are, of course, undertaking cost initiatives where possible to mitigate the impact of reductions or risk of delay.In addition, the Board and executive team will be taking a reduction in compensation effective April 1 for the duration of the disruption."
See Also:
- Leaked memo from Delta reveals plans to cut worker hours and pay, despite protections in the coronavirus stimulus package. United and other airlines are doing the same.
- Iconic planes are disappearing from the sky earlier than planned as coronavirus wreaks airline havoc not seen since 9/11
- 25 brand new routes US airlines are adding in 2020, connecting cities that didn't have an air link