Rail Industry financial performance 14/15

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WatcherZero

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Annual Rail industry financials published by ORR
http://orr.gov.uk/statistics/publis...b-rail-industry-financial-information-2014-15

There is a lot more detailed breakdown, in particular of individual Tocs costs than previous years.

Headline figures

Total Industry income £13.5bn;
71% from passenger (Passenger income was £8.8bn up 5% on the back of 4% increase in passengers and 1% increase in fares. Other passenger income was £0.8bn.),
26% from Government (£3.5bn down 9% £0.4bn or -14% to £3.1bn after accounting for the switch of Government paying NR directly),
3% from property and other income (£0.4bn).

Network Rail received £0.8bn less from TOCs and £0.5bn more from Government.

Total industry expenditure £13.6bn (up 7% £0.9bn), 54% of costs were services 46% infrastructure.Though it varied from 21% of income being from Government in England, 56% in Scotland and 54% in Wales. This variance is mainly down to fixed costs making up a large proportion of total cost, Average passengers per train were 129 in England, 81 in Scotland and 69 in Wales. Subsidy was £1.66 per journey in England, £6.70 in Scotland and £9.14 in Wales.

DfT received £2bn in franchise premiums and gave subsidy of £0.6bn including £0.2bn in revenue support. Other local governments gave combined subsidy of £0.7bn meaning Government made a net profit from services of £0.7bn.
Tocs returned £0.2bn in profit to shareholders.
 
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deltic

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Working out how much the TOCs pay in rolling stock leasing charges per train kilometre operated throws up some surprising figures.

Cross Country £4.47
Greater Anglia £4.11
Essex Thameside £4.05
Thameslink Great Northern £3.51
Trans Pennine Express £3.47
West Coast £3.36
South Eastern £3.34
Southern £3.05
South Western £2.44
ScotRail £2.33
Chiltern £2.32
London Overground £2.23
East Coast £2.17
West Midlands £1.98
Merseyrail Electrics £1.85
Wales & Borders £1.60
Greater Western £1.28
East Midlands £1.23
Northern £1.01
 

WatcherZero

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Interesting but I believe Train KM operated is worked out per multiple unit (e.g. 2x2 formation travelling a km would be 2 rather than 4 train km), rather than per carriage so at Northern say it would be an average of 2 whereas West Coast say would be an average of 10 and most electric commuter Tocs would be an average of 4.

It would skew the cost per operated train in favour of the operators of shorter trains.
 
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daccer

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Interesting that we will soon be at the Govt's notional 75/25 split for passenger vs govt support. I wonder if they will change this target once tey realise that passenger growth seems to be endemic and that the premiums being offered for some of the newly let franchises are substantially elevated towards the back end of the franchise periods.

Also to not NR didnt achieve any efficiency targets in this period, in fact I think they wore more inefficient. This would have loaded the numbers somewhat. I believe the target for the remaining 4 years f the CP are quite onerous.
 

HH

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Interesting but I believe Train KM operated is worked out per multiple unit (e.g. 2x2 formation travelling a km would be 2 rather than 4 train km), rather than per carriage so at Northern say it would be an average of 2 whereas West Coast say would be an average of 10 and most electric commuter Tocs would be an average of 4.

It would skew the cost per operated train in favour of the operators of shorter trains.

Agreed, although most electric commuter TOCs average ~6 cars a train (LO are the exception) and some may be higher. Still, it's interesting that GA are so high; I'm guessing that the refreshes are having to be paid for during this direct award (which will also have lowered the premium paid to DfT).
 

Kettledrum

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Interesting but I believe Train KM operated is worked out per multiple unit (e.g. 2x2 formation travelling a km would be 2 rather than 4 train km), rather than per carriage so at Northern say it would be an average of 2 whereas West Coast say would be an average of 10 and most electric commuter Tocs would be an average of 4.

It would skew the cost per operated train in favour of the operators of shorter trains.

so why do Cross country leasing costs compare so badly to those of East Midlands trains? I assumed the fleet would not be too dissimilar, particularly with a mixture of HSTs and the 220s.

Cross country trains are often shorter too.
 

Clarence Yard

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But which of these leases are "dry", which ones are "soggy" and which ones are "wet"?

The absence or otherwise of "Level 5" costs will make a huge difference here.
 

SamYeager

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Tocs returned £0.2bn in profit to shareholders.

Does this mean TOCs made £0.2bn profit on £13.5bn income or £0.2bn dividend payments to shareholders? If the former then 1.5% profit is hardly anything to write home about.
 
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AngusH

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Those numbers seem in line with what I've seen previously.

For supposedly profiteering exploiters, the profits aren't that high. :)



My understanding is that it's set up so that the operating company pays out whatever surplus it has to the company that owns it (as a dividend)
So that's essentially the profit generated by that particular bit of the group.

The owning group still might not make a profit though, because it may have some additional costs of its own.

Also there is a note in one of the tables that the dividend may not match profits for a particular year,
because profits can be retained and paid later.

(Also several of the franchises listed zero dividend payments, which I thought interesting.
 
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mrmartin

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Does anyone have an ideally quite up to date list of all the TOCs and the subsidy they get from govt / premium paid? Historical figures would also be interesting.
 

aformeruser

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Interesting to see Scotrail's funding per passenger km has stayed the same as the previous year but the funding per passenger journey has decreased. That must mean Scotrail passengers are, on average, making shorter journeys.

At a quick glance

Subsidy reductions (per passenger km) have occurred at Merseyrail, London Overground, Virgin (WC), ATW, TPE, Thameslink Great Northern (now 0p was 1p), Southeastern, Southern, Northern, EMT (biggest drop - was 12p, now 5p), c2c and XC

A premium increase (per passenger km) has occurred at SWT, while EC are now paying a 1p premium.

LM and GWR have seen their subsidy (per passenger km) increase.

No change at Anglia and Chiltern.

Interesting to note only around 60% of LO's revenue comes from their passengers.

ORR seem to have decided Northern and Merseyrail are the only franchises which get PTE funding. Given Manchester-Stockport fares are subsided by TfGM and the revenue gets split between Northern, Virgin, TPE, ATW, XC and EMT that's a bit of a dubious claim!
 
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LNW-GW Joint

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In a couple of tables, £1m cost of traction electricity is allocated to "Wales".
It isn't very clear how ORR determine what costs are in Wales rather than England.
In some cases it relates to NR's "Wales Route" which has a lot of mileage in England (to the gates of Crewe, for instance), and sometimes to W&B as a franchise.
However the costs are split, how does "Wales" incur any costs for traction electricity, with a diesel-only fleet (even including GWR, VT and XC services)?
 
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WatcherZero

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Is it because its spread of the five year control period? i.e. even if it isn't completed till 2017/2018 its cost is divided over the five years.
 

HH

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The liquidity ratio requirement in the FA usually means that some profits (if they are making profits) are left in the company until the franchise ends.
 

absolutelymilk

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Interesting that we will soon be at the Govt's notional 75/25 split for passenger vs govt support. I wonder if they will change this target once they realise that passenger growth seems to be endemic and that the premiums being offered for some of the newly let franchises are substantially elevated towards the back end of the franchise periods.

Indeed, will this lead to more investment and a bigger grant for NR or will they be happy to reduce govt support?
 

Tetchytyke

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Interesting but I believe Train KM operated is worked out per multiple unit (e.g. 2x2 formation travelling a km would be 2 rather than 4 train km), rather than per carriage

Surely that makes sense as the lease costs are per unit, not per carriage (i.e. you couldn't decide to only lease one carriage from a two-carriage unit).

SamYeager said:
Does this mean TOCs made £0.2bn profit on £13.5bn income

The £13.5bn includes the grants paid directly to Network Rail, which are about £4bn.

A more accurate income figure would be the passenger income of £9bn.

I'm also not sure about treating dividend payments as profit. The TOCs received an income of £9.6bn, yet only had expenditure of £8.7bn. Now obviously that isn't all profit, but still.

ETA: the report bears no resemblance to the headline figure.
 
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