Wednesday, 28 June 2017

East Coast - a franchise that keeps on giving

Stagecoach have published their results today.

And they make painful reading, with the company recording an £84.1m exceptional charge to provide for anticipated losses under the VTEC contract over the next two years and a £44.8m non-cash write down on the franchises value.

Chief Executive, Martin Griffiths, said: “We are engaged in discussions with the Department for Transport regarding our respective contractual rights and obligations under the current Virgin Trains East Coast franchise and reflecting the reprioritisation of Network Rail's infrastructure programme. 

"However, separately we have made financial provisions to reflect the short-term outlook for that business over the next two years, including in view of the weak growth environment affecting the UK rail sector as a whole. 

"We are disappointed to report losses at Virgin Trains East Coast. However, I am confident that we can return the business to profitability and build on the significant benefits we have delivered to date for customers and taxpayers."

Stagecoach remains optimistic that the franchise will be profitable by 2019.

Of course much of this may depend on whether NR can deliver on the upgrades to the ECML it promised in CP5? 

Oh, and a recast of the proposed Thameslink timetable?

We shall see.