Channel Tunnel growth despite Brexit and French railway strikes
Channel tunnel operator Getlink expressed confidence over growing profits and dividends this year and in the next four years, despite the challenges resulting from Brexit. The company formerly known as Eurotunnel presented its first-half year results, which indicated a continuing growth.
The Eurostar high-speed train began service between London and Amsterdam in April of 2018. This led to an increase in traffic up to 5.2 million passengers in the first half of 2018. This represents a 3 per cent increase compared to the same period last year. June was a record month with 1 million passengers. This is the second biggest month in their history, despite the impact of strikes during the second quarter.
Despite the impact of French railway strikes, which led to financial damages of 4.5 million Euros off group revenue, the first-half EBITDA (earnings before interest, tax, depreciation and amortisation) had risen 5 per cent to 250 million Euros, while revenues climbed 4 per cent. “Our first half figures are very satisfactory and we have confidence in the future. We keep our forecasts for 2018 and our outlook for the medium-term,” Getlink Chief Executive Jacques Gounon was cited in Reuters.
“I do not expect a major change in trends, even with Brexit. We think we can continue to grow our EBITDA each year”, Gounon continued. Getlink kept its guidance for EBITDA of 545 million Euros for the 2018 full year, with a dividend of 0.35 Euros per share. It also reiterated its outlook for EBITDA of over 735 million Euros by 2022, with a free cash flow of 400 million Euros. Its dividend is set to rise 0.05 Euros each year by 2022.
Last year Getlink recorded a four per cent rise in revenues for 2017, up to 1,033 billion Euros. The revenues of Europorte, Getlink’s dedicated rail freight arm and the third biggest operator in France, were up by 2 per cent to 118.5 million Euros. The company is dedicated to relaunch rail freight, which is one of its businesses. It already constructed the whole-train scanner in Frethun, introduced the ETICA (financing) scheme, which supports the launch of new services and added efficiency to border formalities at the Frethun yard with Europorte Channel.