Losses at toll road company rise 63%

Pre-tax losses at the firm that operates the tolled €810m Limerick tunnel last year rose 63% to €8.3m.

According to accounts just filed with the Companies Office, Directroute (Limerick) Ltd sustained the €8.3m pre-tax loss after revenues dropped by 10% from €23.1m to €20.6m.

The directors’ report says: “Revenue is generated by toll charges and payments from the NRA [National Roads Authority]. The largest expense remains the project funding mainly in the form of loans and bonds. Traffic guarantee payments have in increased in line with the contract and providing a necessary contribution to project funding.”

Recently, Leo Varadkar, the transport minister, conceded over €30m could be spent in the next three years compensating toll operators on the Clonee-Kells M3 motorway and Limerick tunnel.

The NRA has estimated the cost in 2013, 2014, and 2015 of the “traffic guarantee” based on no traffic growth at €31.96m for both schemes. If traffic grew by 1% the figure would be reduced to €30.05m and down to €28.13m if growth was 2%. The system was put in place due to the high cost of the route and due to it being a challenging project to deliver.

At the end of December last, DirectRoute (Limerick) Ltd owed €251.9m in loans to group companies.

DirectRoute generated revenues of €20.6m from tolls and operational payments from the NRA. It added €5.8m to its revenues in “other operating income” — a similar figure to the €5.8m generated in 2011.

The decline in revenues resulted in operating profits dropping by 42% from €8.2m to €4.7m. Interest payments of €13.8m resulted in the firm recording a pre-tax loss of €8m. This followed a pre-tax loss of €5m in 2011. Operating costs of €21.7m include non-cash depreciation costs of €13.4m showing that the earnings excluding depreciation amounted to €5.4m.

The firm had a shareholders’ deficit of €16.5m. The toll road and tunnel had a book value of €386m.

© Irish Examiner Ltd. All rights reserved

Irish Examiner live news app for smartphones lets you quickly access breaking news, sport, business, entertainment and weather. appstoregoogle play
Irish Examiner ePaper app gives you the entire newspaper delivered to your phone or tablet for as little as 55c a day. epaper
Home

More From The Irish Examiner