Eurotunnel’s profit for the first half of the year has been slumped into the red following issues around MyFerryLink.
The cross-channel operator posted a net loss of EUR11m (US$14.8m, GBP8.6m) for the first six months of 2014 but excluding losses from MyFerryLink would have posted a EUR3m (US$4m, GBP2.3m) profit.
The ferry services have been subject to several competition reviews since Eurotunnel bought three ex-SeaFrance vessels. MyFerryLink has been operating some services but has been prohibited from operating Berlioz and the Rodin to Dover.
The firm said there was a ‘clear indication of support’ for the ferry company after the freight sector saw a boost, but the services are still under review by the Competition Markets Authority (CMA) which is concerned over Eurotunnel’s potential large share in cross-Channel travel.
“Freight traffic has leapt by 30% despite the series of negative announcements from the CMA, which is a clear indication of customer support for MyFerryLink. For cars, a continuing lack of awareness of MyFerryLink is slowing its progression,” its statement read.
“It is on behalf of the customers who are attracted in significant numbers to the quality service offered by this maritime operator that Eurotunnel is appealing the prohibition, decreed by the CMA, from operating out of Dover. This decision, if it is confirmed, would lead immediately to a reduction in consumer choice across the Channel and would probably increase prices for consumers.”
On its rail services the company saw more than 1.12 million cars use the Eurotunnel services in the six months, marking a 5% increase, with revenues from the railway network up 3%. Its EBITDA increased EUR12 million to EUR216m for the six months and while operating costs have gone up 6% its net finance costs were reduced by EUR6m.
“All areas of our business are growing. The Fixed Link [tunnel] achieved a record level of operating margin in a very active cross-Channel market. The new environmental constraints which will be imposed on the ferry companies from 1 January 2015 reinforce the attractiveness of the Fixed Link,” said Jacques Gounon, chairman and CEO of Groupe Eurotunnel SA.
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