Half year results : sustained activity levels, Eurotunnel: leader across the Channel

22/07/2011 - 10:00
    • Revenues increased to €396 million (+22%)
    • EBITDA improved to €189 million (+37%)
    • Trading profit almost doubled: €112 million (+88%)
    • Net profit of €2 million
  • The cross-Channel Fixed Link:
    • Revenues increased significantly to €324 million (+10%) compared to the first half of 2010 at a constant exchange rate:
        • Shuttle revenues increased by 9%
        • Revenues from the railway network increased by 11%
    • Traffic growth:
        • Truck Shuttles (+21%), Passenger Shuttles (cars +5%)
        • Eurostar passengers (+3%)
  • Europorte : a major contribution to revenues
      • New contracts and the integration of GBRf have brought revenues to €72 million

Jacques Gounon, Chairman and Chief Executive Officer of Groupe Eurotunnel SA, stated,

“This first half result is very satisfying: we have increased traffic without sacrificing prices which is positive given the strongly competitive nature of the Short Straits market. Developments in rail freight have brought expected growth and provide new opportunities for the future”.

Key events in the first half of the year

  • Eurostar and SNCF have withdrawn their claim, which is an important step towards a settlement of the damages resulting from the fire in 2008. €66 million in insurance indemnities was received in the first half, of which €30 million has been included in the income statement. Thus Eurotunnel has recovered the sums due and continues to negotiate the final settlement for operating losses relating to Truck Shuttle activity.
  • Distributed Traction has now been accepted and this should lead to a rapid increase in exchanges between Great Britain and Continental Europe as part of the European Directive on the liberalisation of international passenger traffic.
  • The European Commission has opened a second phase of investigation into the recapitalisation request made by Seafrance, which remains in judicial administration.
  • As part of Tunnel optimisation, the Eurotunnel Group announced the creation of a joint venture with STAR Capital to develop an electrical interconnector between Great Britain and France.
  • Having already won the tenders for the management of the railway infrastructures at the ports of Dunkirk and Nantes, Eurotunnel has been retained to produce the Safety Document for the Grand Port Maritime de Bordeaux.
  • The spectacular increase in tonnage (+21%) carried on rail freight trains travelling through the Channel Tunnel and the increase in the number of these trains (+16%) is evidence of a return to rail for many industrial customers who see the advantages of using clean and low energy transport.
  • The whole of the Eurotunnel Group has been certified by the independent British organisation, the Carbon Trust Standard for its policy and results in relation to the reduction of the Group’s carbon footprint. The cross-Channel Fixed Link has reduced its carbon emissions by a further 20.5%, following the reduction in greenhouse gas emissions of 44% between 2006 and 2008.

Sustained activity and retention of market share

Eurotunnel has continued to demonstrate its capacities as a major player in the cross-Channel market with strong growth in activities both in terms of its Shuttle traffic (cars and trucks) and numbers of Eurostar passengers and rail freight. For the first half of 2011, market share for Truck Shuttles has been stable at above 37%. For Passenger Shuttles, Eurotunnel continues to be the leader in the cross-Channel market, with a market share close to 50%. Eurotunnel has increased its market share despite a slight contraction (-2%) in the Short Straits market, as the first half of 2010 was impacted positively by the one-off effects of the eruption of the volcano in Iceland.

The spectacular growth in tonnage transported on rail freight trains travelling though the Channel Tunnel (+21%) is linked to the development of Open Access, which has improved the competitiveness of rail freight, whilst a short term increase in steel traffic has brought an acceleration of this growth.

Financial results in line

The figures for the first half show a significant increase in EBITDA (+37% at a constant exchange rate).

The evaluation of the gross debt was made on the basis of an assumption for inflation in the United Kingdom estimated to be at 5% in 2011 (compared to an average of just under 3% from 2007-2010), resulting in a charge of €130 million. However, the interest paid in June was not affected and remained stable at €102 million.

After payment of the interest, €53 million of capital expenditure and €21 million of dividends, cash has increased to €346 million (€316 million at 31/12/2010).

Finally, the consolidated net result passed from a loss of €47 million (recalculated at a constant exchange rate2) for the first half of 2010 to a profit of €2 million for the first half of 2011.

Appendix 1: Traffic and revenue figures for the first half of 2011

Appendix 2: Half-Yearly Financial Report at 30 June 2011

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