Eurostar delivers a strong performance in 2012

Eurostar, the high-speed passenger rail service between the UK and mainland Europe, today reported a strong performance in 2012 marked by rising passenger numbers and good growth in profitability.

Despite the difficult economic backdrop, passenger numbers for the year ended 31 December 2012 rose 2% from 9.7 million to 9.9 million. Whilst business travel remained flat, the uplift in passengers was underpinned by continuing resilience in the leisure travel market as the number of leisure passengers grew by 3% compared to the previous year.

The number of international travellers originating outside the EU has shown particularly strong growth during 2012, with volumes up 8% year-on-year. Responding to the difficult European economic environment, Eurostar has invested heavily in its international marketing capitalising on London’s year in the spotlight with the Jubilee celebrations and a summer of sporting action.

Nicolas Petrovic, Chief Executive, Eurostar, said:

“Despite the challenging economic climate we delivered a strong performance in 2012. The combination of the Olympic Games and the Jubilee gave London a major boost showcasing the city as a prime travel destination. Growth in traveller numbers was particularly strong in the fourth quarter of the year as European and international travellers flocked to the capital.”

In 2011 Eurostar delivered its first profit in its first full year of operation as a standalone company. Continuing this momentum, the business today reports an operating profit of £52.3 million in 2012, up from £25.0 million in 2011. This growth in profitability is driven by an increase in the volume of passengers combined with strong cost management across the business.1

Sales revenues in 2012 were broadly flat year-on-year at £799 million versus £803 million in 2011. The sales revenues were, however, heavily impacted by the movements in exchange rates over the year. At constant (€1.15) exchange rates, sales revenues increased by 5%.

Building the business for the next phase of growth

Eurostar continues to innovate and enhance its service and the investments it is making over the next two years will shape the business for future growth.

The £700 million investment in creating a new fleet of trains remains on track with the production of Eurostar’s new e320 trainsets and the refurbishment of its existing fleet progressing well. Both the refurbished and new train sets are being delivered to a design created by Pininfarina, the world-famous Italian design house, and the business looks forward to presenting its customers with a completely new fleet by 2015.

2013 also marks the launch of new services. Ski enthusiasts will benefit this year from a new partnership with international high-speed train operator TGV Lyria offering a weekly service between London and some of Switzerland’s most popular ski resorts, while later this summer, new direct services to Lyon and Provence will launch for a trial period.

Nicolas Petrovic continues:

“The next couple of years will see the transformation of our business with a range of initiatives including the delivery of a new fleet and the launch of new services. Today’s results are testament to the substantial growth opportunities within the business and the continuing drive to unlock this potential.”

Reference

1. The net profit for 2012 was £91.0 million compared with £20.8 million in 2011, principally reflecting the increase in operating profit referred to above as well as a non-trading item in the year.