Railtrack Announces Interim Results for the Six Months Ended Sept. 30, 1997.LONDON--(BUSINESS WIRE)--Nov. 13, 1997--Railtrack, Britain's rail infrastructure company, today announced its interim results for the six months ended September 30, 1997. Highlights -- Investment related expenditure up 38% to 520 million pounds ($840 million)(a). -- Station regeneration program now up and running with 65 million pounds($105 million) spent in the period, 90 stations completed and 130 with work on site. -- 40 million pounds($65 million) station security program announced. -- 600 million pounds($969 million) West Coast Main Line revenue sharing revenue sharing Funding arrangement in which one government unit grants a portion of its tax income to another government unit. For example, provinces or states may share revenue with local governments, or national governments may share revenue with provinces or states. upgrade with Virgin announced. -- In spite of a 5% increase in passenger miles and increased investment activity, operating performance has been maintained at last years levels (up 38% on 1995/96). -- Operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. up by 9% to 184 million pounds($297 million). -- Profit before tax of 190 million pounds($307 million), up 10%. -- Interim dividend of 7.9p (12.8 cents) per share, up 8%. (a) US dollar equivalents are provided for reader convenience at the September 30, 1997 exchange rate of 1 pound = $1.6156 Chairman's Statement Railtrack has continued to deliver against its objectives with sound and safe operational performance, a substantial increase in investment spend, increased efficiency and growing returns for shareholders. Investment The commitment to our major investment program has continued with a 38% increase in total asset-related investment spend to 520 million pounds($840 million) for this period. We are on track for delivering our major 10 billion pounds investment program by 2001. -0-
(in millions) 1997 1997 1996 %
$ pounds pounds change
AMP expenditure 428 265 190 39%
Net capital expenditure 365 226 175 29%
Backlog expenditure 47 29 11 164%
Total 840 520 376 38%
Station regeneration
(included in above) 105 65 11 491%
-0- Railtrack's investment program has a number of initiatives covering all aspects of the network. Some of the highlights include: Station regeneration program - The program to refurbish re·fur·bish tr.v. re·fur·bished, re·fur·bish·ing, re·fur·bish·es To make clean, bright, or fresh again; renovate. re·fur nearly all of Britain's stations is gaining pace with over 90 projects completed and a further 130 now on site. 65 million pounds was invested in the period, up from 11 million pounds in the same period last year. In addition, 600 stations have agreed programs of work with the train operating companies The term train operating company (abbreviated to TOC) is used in the United Kingdom to describe the various businesses operating passenger trains on the railway system of mainland Great Britain under the collective National Rail brand. . The reorganization of the program in May which decentralized de·cen·tral·ize v. de·cen·tral·ized, de·cen·tral·iz·ing, de·cen·tral·iz·es v.tr. 1. To distribute the administrative functions or powers of (a central authority) among several local authorities. project sponsorship to the Zones has been successful in focusing the program and gaining commitment from our customers. In spite of the slow start, we are now confident of completing the station regeneration program on schedule in 2001, when nearly all 2,500 stations will have been refurbished. Station security program - In addition to the 1 billion pounds station regeneration program, we have recently committed a further 40 million pounds to spend immediately on improving station security. This program will install improved lighting and closed circuit television at around 800 stations recognizing the urgent need to improve security at urban stations. New stations - We are currently involved in the construction of 12 new stations across the country. For example in June, we approved the construction of a new parkway station at Luton to provide better links to the airport and the M1 motorway. This 12 million pounds station will be equipped with airline check-in and baggage handling facilities, car parking for 1,000 cars and many other modern amenities. Work is also underway at Conway Park to provide a new station link to Birkenhead's central shopping area in a project funded by the local authority, the PTE PTE The ISO 4217 currency code for the Portugese Escudo. and the EU. West Coast Main Line - We have recently announced a new deal with Virgin Rail Group to further upgrade the West Coast Main Line. We had already committed 1.5 billion pounds to the first phase of investment which will enable the introduction of advanced tilting trains A tilting train is a train with a mechanism that enables increased speed on regular railroad tracks. As any vehicle rounds a curve at speed, independent objects inside it exert centrifugal force since their inherent momentum forward no longer lies along the line of the vehicle's with an operating speed The operating speed of a road is the speed at which motor vehicles generally operate on that road. The precise definition of "operating speed", however, is open to debate. of 125mph by 2002. The new 600 million pounds deal represents the second stage of the program which will further enhance line capacity and increase line speed to 140mph. This part of the investment program will be jointly financed by ourselves and Virgin Rail Group, in part through conventional track access charges and partly by a revenue sharing deal between the two companies. This investment will lead to improved capacity, shorter journey times, better punctuality Punctuality Fogg, Phileas completes world circuit at exact minute he wagered he would. [Fr. Lit.: Around the World in Eighty Days] Gilbreths disciplined family brought up to abide by strict, punctual standards. [Am. Lit. and enhanced passenger comfort. It is our first major revenue share deal and is currently subject to Regulatory approval. We are committed to expanding the network's capacity in a way which enables our shareholders to participate in its growth. Performance Last year's operating performance for Railtrack represented a step change improvement on the previous year with the total minutes delay attributable to Railtrack down 38%. This strong operational performance has been maintained at a similar level to last year while accommodating increased investment activity and a 5% increase in the number of trains travelling on the network. A series of performance initiatives are currently being implemented which will deliver future performance improvements. Next to safety, delivering improving performance for our customers and the traveling public is our most important objective. This continued solid performance delivered a performance regime profit of 9 million pounds($15 million) (1996 - 4 million pounds) against a reduction in the access charge supplement of 4 million pounds($7 million). This reflects the significant improvement in our performance since 1995/96 when the performance regime was introduced. Profits and dividends Our Group operating profit for the six months ended September 30, 1997 increased by 9% to 184 million pounds ($297 million) from the same period last year. After interest of 15 million pounds, Group profit before tax rose 10% to 190 million pounds($307 million). Adjusted earnings per share for the half year before Windfall Tax windfall tax Noun a tax levied on profits made from the privatization of public utilities were 33.6p (54.3 cents) per share as compared to 29.0p for the same period last year. After charging Windfall Tax of 155 million pounds, earnings per share were 2.6p (4.2 cents) per share. We are declaring an interim dividend of 7.9p (12.8 cents) per share to be paid on February 6, 1998. This represents an 8% increase on last year's interim dividend in line with our progressive dividend policy. Revenue Our revenue for the period was 1,226 million pounds($1,981 million) with passenger track access income accounting for 86% of the total. Passenger track access income increased 1% to 1,060 million pounds($1,713 million) (1996 - 1,046 million pounds) principally from the application of the RPI-2% formula. Freight income increased slightly in the period to 80 million pounds($129 million) (1996 - 79 million pounds) from a growth in non-coal traffic. Property rental income Noun 1. rental income - income received from rental properties income - the financial gain (earned or unearned) accruing over a given period of time saw a 5% increase to 61 million pounds($99 million) (1996 - 58 million pounds) due to a rise in property lettings. An increase in Eurostar traffic caused other income to grow by 19% to 25 million pounds($40 million) (1996 - 21 million pounds). Operating costs operating costs npl → gastos mpl operacionales After taking into account inflation, the period saw progress in delivering efficiencies. The largest savings have been made in infrastructure maintenance with a spend of 362 million pounds($585 million) (1996 - 371 million pounds) which represents a real saving of 5%. Joint industry costs fell by 6% on last year to 94 million pounds($152 million) (1996 - 100 million pounds) which reflects savings in the electricity for traction contracts. Production and management expenses, after business restructuring, and other one-off costs of 18 million pounds(1996 - 4 million pounds), were constant in real terms at 255 million pounds($412 million) (1996 - 247 million pounds). The Asset Maintenance Plan charge increased in line with inflation to 265 million pounds($428 million) which matched the actual spend for the period (leaving the balance sheet AMP provision unchanged). Property Profits from property disposals were 21 million pounds($34 million) (1996 - 23 million pounds). The main receipts were 4 million pounds for land at Fenchurch Street Fenchurch Street is a road in the City of London in London, United Kingdom. The road links Aldgate at its eastern end with Lombard Street and Gracechurch Street to the west. To the south of Fenchurch Street and towards its eastern end is Fenchurch Street railway station. , London, 4 million pounds for land at Leatherhead leath·er·head n. See friarbird. and 2 million pounds for land at Oxford. Taxation The tax charge for the period was 22 million pounds reflecting an effective tax rate of approximately 12% (1996 - 16%). The low effective tax rate reflects the tax allowances available as a result of the Company's substantial capital expenditure and backlog programs. Our results are depressed by a 155 million pounds Windfall Tax liability which is payable in two equal installments on December 1 of 1997 and 1998. The total Windfall Tax liability has been charged in this half year's results. Debt Net debt was 532 million pounds at September 30 (346 million pounds at September 30, 1996). Railtrack has begun refinancing Refinancing An extension and/or increase in amount of existing debt. the revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility put in place at the time of flotation flotation or froth flotation Most widely used process for extracting many minerals from their ores. The method separates and concentrates ores by altering their surfaces so that they are either repelled or attracted by water. with the successful issue of a 300 million pounds 25 year fixed rate bond on October 21. Railtrack's credit rating by Standard and Poor's Noun 1. Standard and Poor's - a broadly based stock market index Standard and Poor's Index was upgraded to AA-, reflecting the strength of the Company's business and financial position. Further increases in net debt are expected as a result of the continued build-up build·up also build-up n. 1. The act or process of amassing or increasing: a military buildup; a buildup of tension during the strike. 2. in the Company's investment program. We will actively seek further opportunities to diversify our sources of finance. Safety We share a deep regret that, despite the overall maintenance of safety levels, a tragic accident occurred at Southall which claimed the lives of seven passengers and resulted in injuries to over 160 people. The forthcoming public inquiry will fully investigate the cause of the incident. Railtrack, in conjunction with train operating companies and British Transport Police The British Transport Police (BTP) is a special police force[1] empowered to police those railways and light-rail systems in Great Britain for which it has entered into an agreement to provide such services. , has continued to put in place measures to minimize the worrying level of accidents and fatalities arising from trespass on trespass on or upon Verb Formal to take unfair advantage of (someone's friendship, patience, etc.): I won't trespass upon your hospitality any longer the railway. Once again throughout the summer, publicity and information initiatives were taken to highlight the extreme dangers to children of playing on railway lines. It is encouraging to report that more than a year has passed since the last trackside track·side n. The area near a track, especially a racetrack. worker fatality fa·tal·i·ty n. 1. A death resulting from an accident or disaster. 2. One that is killed as a result of such an occurrence. , in marked contrast to the industry's record in the 1980's and early 1990's. Safety is and will continue to be the foremost priority. We pursue the highest standards of safety, and the accident at Southall makes us all the more determined to strive to maintain the record of the railways as the UK's safest form of land transport. Regulatory Railtrack continues to have a constructive relationship with the Office of the Rail Regulator Statutory office - created with effect from 1 December 1993 by section 1 of the Railways Act 1993 - for the independent economic regulation of the British railway industry. . Railtrack's Network License was modified in September, establishing new powers for the Regulator in respect of Railtrack's obligation for the maintenance, renewal and development of the rail network. As part of this, we are developing investment criteria and output measures by which the Regulator and other stakeholders Stakeholders All parties that have an interest, financial or otherwise, in a firm-stockholders, creditors, bondholders, employees, customers, management, the community, and the government. can judge Railtrack's performance. Both will be reflected in our third Network Management Statement (NMS See NetWare Management System. ) to be published in March. Relationship with Government We share with Government a strong belief that Britain needs a growing rail network at the heart of an integrated transport system. We will work with Government in our common objectives: increasing investment in a safe and efficient network, improving performance, developing public/private partnerships, growing freight and passenger traffic, adding capacity and becoming a more customer focused, responsive company. Our core skills include engineering and project management and we remain interested in and committed to the future expansion of Britain's rail network. The future of the Channel Tunnel Rail Link The Channel Tunnel Rail Link (CTRL) is a project to construct a 108 km (67 mile) high-speed railway line from London through Kent to the British end of the Channel Tunnel. and London Underground The London Underground is an underground railway system - also known as a rapid transit system - that serves a large part of Greater London, United Kingdom and some neighbouring areas. It is the world's oldest underground system, and is one of the longest in terms of route length. are matters for Government and the existing stakeholders. If consulted and bearing in mind the interests of our own shareholders, these are projects which we will review should the opportunity arise. At this stage no serious discussions have taken place. Marketing Railtrack is continuing to develop its link with the train operating company customers. Against a background of increasing passenger miles (up 5%) and freight ton miles 1. (Railroads) A unit of measurement of the freight transportation performed by a railroad during a given period, usually a year, the total of which consists of the sum of the products obtained by multiplying the aggregate weight of each shipment in tons during the given (up 4% excluding coal), Railtrack is actively developing its future investment strategy. The success of the other revenue sharing deals with Chiltern and North West Trains along with Virgin Trains point the direction of our future commercial strategy. The continuing pressure on the network to expand capacity gives Railtrack the opportunity to target its investment in anticipation of customer requirements. This proactive approach will demonstrate our commitment to customer focus and meeting the aspirations of rail passengers. Management and Organization In this half year we welcomed Gerald Corbett fully-protect. as our new Chief Executive and Richard Middleton Notable individuals named Richard Middleton:
definition - a concise explanation of the meaning of a word or phrase or symbol of roles. We have commenced an organization change program designed to increase the Company's responsiveness, customer focus and speed of decision making. This involves reducing bureaucracy, minimizing administrative procedures and delegating decision making. Strategy We are totally dedicated to continuing to improve performance and safety, implementing our substantial investment program and achieving cost and other efficiencies in all that we do. In the longer term we are seeking to direct our investment into areas which can deliver growth to enable shareholders to participate in what we see as a new era for the railways. Our revenue sharing deals with a number of customers are just such investments. Working closely with Government and the Regulator, we are committed to growing the rail network at the heart of an integrated transport system. Outlook Our trading experience to date is broadly in line with expectations and the remainder of the year should be a continuation of the trends established in the first half - a steady operating performance, combining with a sharp increase in investment and continuing cost efficiencies. Sir Robert Horton For the American actor and star of the TV series Wagon Train, see . Sir Robert Horton (born 18 August 1939) is a UK businessman. He is the eldest of three brothers, David Horton and Mark Horton. Chairman (FOR TABULAR tab·u·lar adj. 1. Having a plane surface; flat. 2. Organized as a table or list. 3. Calculated by means of a table. tabular resembling a table. INFORMATION, PLEASE CALL TAYLOR RAFFERTY ASSOCIATES AT 212-889-4350) CONTACT: Peter Durman RAILTRACK 011-44-171-557-8151 - or - Brian J. Rafferty Taylor Rafferty Associates 212-889-4350 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion