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Le Shuttle runs 24 hours

Eurotunnel, the beleaguered Channel Tunnel operator, said yesterday that its Le Shuttle tourist service for cars was now running a round-the-clock service.

Le Shuttle, which went into service on 22 December, had until now offered hourly trains from both sides between 7am and 11pm. An overnight service will now run every two hours. The extra night services introduced on 2 January increase the overall number of shuttles through the tunnel from 26 to 40 per day.

The announcement, welcomed in the city as a sign that Eurotunnel's trading should improve in 1995, said that 12,000 reservations had been booked in the last two weeks of December for the 35-minute journey between Folkestone and Calais.

The news put further pressure on Eurotunnel's main rival, P&O, already facing the prospect of tougher ferry safety rules, whose shares fell 13p to 597p. Eurotunnel closed up 15p at 312p.

"They [P&O] are going to lose market share but a lot was already anticipated in many analysts' forecasts,'' Richard Hannah, analyst at UBS, said.

Michael Cohen, a Salomon Brothers analyst who has been bullish about Eurotunnel for several months, said he was considering upgrading his Eurotunnel financial forecast. He saw the shares as undervalued up to around 340p or Fr29.

Eurotunnel emphasised that these were early days for the services and would not alter last October's gloomy financial statement from Sir Alastair Morton, the co-chairman. He revealed that 1994 revenues would reach only about £35m compared with the £135m forecast at the time of the £8585m rights issue in May. Revenues in 1995 - the year Sir Alastair said would be critical - would be hit by delays in starting services, he said.

The company announced that the Eurostar passenger train service has also increased departures to four a day in each direction between London and Paris, and three a day between London and Brussels.

The frequency and capacity of services would continue to increase during the first quarter of 1995, building up to a peak summer period, the company said.

Outlook, page 33