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Network Rail profits more than double

Network Rail has announced an increase in both profits and debts in its full-year financial results for 2011/12, as well as progress on making efficiency savings and repaying money to the UK and Scottish Governments.

Its post-tax profits increased by £441m to £754m: more than double the 2010/11 figure of £313m. Overall capital expenditure was also up, at £4.6bn, from £3.997bn the year before.

Staff numbers fell slightly to 35,253, from 35,606, though average salaries rose by 2.2%. This meant its overall staff costs were down by £55m, to £1.679bn.

Net debt rose to just over £27bn, up from £25bn in 2010/11. The gearing ratio figure, representing debt to regulated asset base, stood at 62.5%, as compared with 63.4% last year.

Group finance director, Patrick Butcher, highlighted the reduction in operating costs of £120m on the year before and said: “Our results today demonstrate clear and steady progress in meeting our efficiency targets. These targets are tough but we are committed to succeeding.

“In a year where Network Rail has maintained financial discipline, we have continued to deliver a larger capital programme, building the capacity of the railway of tomorrow.

“At the same time Network Rail has shown it is open to change and reform – with the aim of delivering greater accountability and better value and service for our customers and funders.”

The company said it was making ‘steady progress’ towards the ORR efficiency targets for CP4.

The UKand Scottish governments received £153m back from Network Rail in the last two years.

Operating and maintenance costs per train mile in real terms have fallen by 84p to £7.04 during the last year – down from £12.05 (2011/12 prices) in 2003/04.

Butcher added: “Amidst structural change and progress in achieving tough efficiency targets, Network Rail remains focused on the day job of providing a safe and reliable railway. In tough economic times, we are carrying more passengers and more freight.

“Punctuality increased this year, although progress was not uniform and we agree with the ORR that we have more to do, especially for the long-distance sector. By continuing to invest in greater capacity and connectivity – as the Government’s command paper recommends – we will be able to meet the challenge of further increases in passenger and freight traffic.

“This will involve looking at tough choices to balance reliability, capacity growth and efficiency. These discussions will inform the rail industry’s strategic business plan, published later this year, which will set out our proposals for the next control period.

“By finding fresh ways of working both within the business and with the rest of the industry, Network Rail believes that the railway in Great Britain can secure a bright future – popular, punctual and providing better value to passengers and taxpayers.”

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