BC Ferries says it has sailed much smoother waters when it comes to its earnings this year compared to 2011, partly due to a fuel surcharge.

The corporation released its first quarter results Friday covering the period between March and June, showing net earnings of $3.3 million.

It lost $3.5 million over the same period last year.

Revenues increased 5.7 per cent, but almost half of the extra $10.6 million was due to the hike in fuel surcharges levied as a result of higher gas prices, the corporation said in a news release.

About $3.6 million was spent to cover those higher fuel costs.

Car and foot traffic continued a declining trend as BC Ferries experienced a drop of 1.7 per cent in vehicle traffic and 2.4 per cent in passenger traffic.

"We are managing our bottom line as efficiently as possible with our cost containment initiatives in order to reduce expenditures without compromising the safety of our operation," said Mike Corrigan, BC Ferries' president and CEO.

Corrigan said the corporation is looking forward to the government-established public engagement process to give British Columbians a voice in adjustments to service levels and the long-term vision for the corporation.