Eurotunnel celebrates profit milestone

Channel tunnel operator Eurotunnel today hailed a “remarkable” turnaround after the venture posted its first annual profit today.

The group made €1m last year thanks to a huge financial restructuring which around half of its £6.2 bn (€7.8bn) debt wiped out. As a result, debt interest payments during the year were slashed 40% to €292m.

Revenues were up with Eurotunnel’s car and truck service Le Shuttle enjoying an 8% revenue rise, while railway income from the independently-managed Eurostar service improved 3%.

Traffic received a big boost from last autumn’s Rugby World Cup, which saw thousands of fans travel to France to cheer on the home nations. Total underlying revenues increased 6% to €775m.

Including a €3.3bn accounting gain from the financial restructuring, Eurotunnel posted a net profit of €3.32bn, compared to a loss of 204 million in 2006.

Chairman and chief executive Jacques Gounon hailed the figures, saying: “2007 shows that the new Groupe Eurotunnel is nothing like the old.

“The results are due to remarkable levels of performance and to strict management of operating costs. They also benefit from the massive reduction in debt achieved through the financial restructuring.”

He also said this year had started well for the company, with first quarter revenues 15% ahead at €187.6m.

One blackspot last year was a fall in rail freight tonnage, which dropped nearly a quarter.

The tunnel has the capacity to carry 10 million tonnes of rail freight every year, but the business has dwindled to just over one million tonnes amid competition from road transport firms and high security costs to prevent illegal immigration.