As Railtrack prepared to take an active part in creating the Channel Tunnel fast link, the company reported profits up by 12% this year to £380 million.
Shareholders were given the good news at the annual general meeting in Manchester in June.
Access charges provided Railtrack with 93% of its turnover of £2.4 billion.
There was a 12% growth in freight tonne kilometres, a 5% growth in passenger kilometre mileage, a 4% increase in the number of trains and 50 million more passenger journeys during the year.
But the current well-publicised investment programme is being funded largely by borrowing, making Railtrack the fifth highest borrower of the companies listed in the Footsie 100 although it is rated 40th in size.
This is not an ideal situation and an element of refinancing, possibly further share issues, will be needed to provide for further investment.
The question of how to fund the Channel Tunnel fast link will be the subject of an extraordinary general meeting in the autumn. Look out for notices in the Press.
In July, it was revealed that Railtrack had hired McKinsey, the management consultancy, to review its multi-billion pound property portfolio. The company announced that it would be selling its £120 million Broadgate development, which adjoins London‘s Liverpool Street station. There was speculation in the Press that Railtrack may soon embark on a rapid sale of other property assets.
It was also announced that Railtrack shareholders would be encouraged by preferential deals to take their dividends in shares rather than cash.
At the AGM, RDS executive officer Nat Taplin, national executive member David Redgewell and I were well received by the Railtrack board.
RDS scored a minor coup when ours were the first two questions called.
Our concerns though centred on how few station openings are planned and the erratic pace of refurbishing existing ones.
Railtrack responded to our inquiries by announcing that 25 reopenings are planned this year. We await their list with interest.
On refurbishment, they accepted a lack of consistency, but said a standard benchmark had been established which could be varied according to the demands of the train operators and /or the local authority. We have asked for details of the benchmark.
A number of useful contacts were made during the event and further meetings with Railtrack are planned.
Incidentally I travelled to Manchester by Virgin Trains from London — and was one hour late arriving.
David Bigg is a former treasurer of RDS, and chairman of both the parliamentary liaison committee and the Witham and Braintree Rail Users Association
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