Revenue shock adds to fears for Eurotunnel

Fears about a financial crisis at Eurotunnel deepened yesterday when the Channel tunnel operator released revenue figures far below its projections.

News that turnover for the first half of the year reached just pounds 104.5m ended a gloomy week for Eurotunnel, coming after an analyst's report of a looming cash crisis and a strike at Eurostar.

The company admitted that the figures were on the low side, but pointed to better days to come. However, the results are unlikely to impress the 225 banks due to meet Eurotunnel in the autumn for talks about advancing more funds to keep the company afloat.

Last year the company was forecasting revenues of pounds 500m for 1995. Although bankers have already discounted the chances of Eurotunnel meeting these targets, one said: "These figures do nothing for one's confidence. We will just have to wait and see what the company says in a few weeks."

The operator will be asking bankers for the release of more than pounds 400m in loans, which would see it through financially until 1996. Sir Alastair Morton, co-chairman of Eurotunnel, had already admitted that the company was at risk from its debts and could fold unless the banks released more funds.

Eurotunnel's turnover in the second quarter came in at pounds 60.3m, after the pounds 41.6m in the first three months. Richard Hannah, a UBS analyst who has been extremely cautious about Eurotunnel, had estimated a second quarter turnover of pounds 65m. Eurotunnel shares dropped 3 per cent in London and Paris to 175p and Fr13.50. Shares were not helped by a decision by Capital Group to cut its Eurotunnel stake.

The summer months are crucial for Eurotunnel, which is engaged in a price war with the ferry companies. The operator has been plagued by repeated delays, breakdowns and poor passenger numbers.

Looking to the future, Eurotunnel said the third-quarter turnover should be much higher than the second, since shuttle traffic had increased since the start of summer, as had the prices.

At the end of July, Eurotunnel was operating at a rate of 4,500 cars carried per day with peaks of 5,200, plus coaches. For trucks, the rate was 1,200 to 1,300 a day, with peaks at 1,900.

Eurotunnel claims to be taking more trucks than the P&0 ferry company on the popular Dover-Calais route. It hopes to negotiate increases in the tolls paid by the rail companies.

On Thursday French staff at Eurostar, which pays tolls to Eurotunnel to send trains through the tunnel, announced a strike that will cripple weekend services.

And earlier this week, Klesch & Co, the debt specialists, warned that Eurotunnel would be forced to undergo a partial financial restructuring this autumn, and a full pounds 3bn debt-for-equity swap by the end of 1997. Raising new cash from shareholders is out of the question because of the low share price, and the chances of a bond issue succeeding are unlikely, according to Klesch.

The strike at Eurostar is expected to continue to disrupt services until Monday, France's busiest holiday period.

Comment, page 17

News
people'It can last and it's terrifying'
Sport
Danny Welbeck's Manchester United future is in doubt
footballGunners confirm signing from Manchester United
Sport
footballStriker has moved on loan for the remainder of the season
Sport
footballFeaturing Bart Simpson
PROMOTED VIDEO
News
Katie Hopkins appearing on 'This Morning' after she purposefully put on 4 stone.
peopleKatie Hopkins breaks down in tears over weight gain challenge
News
Ricky Gervais performs stand-up
people
Arts and Entertainment
Olivia Colman topped the list of the 30 most influential females in broadcasting
tv
News
Kelly Brook
peopleA spokesperson said the support group was 'extremely disappointed'
Life and Style
techIf those brochure kitchens look a little too perfect to be true, well, that’s probably because they are
Sport
Andy Murray celebrates a shot while playing Jo-Wilfried Tsonga
TennisWin sets up blockbuster US Open quarter-final against Djokovic
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Hare’s a riddle: Kit Williams with the treasure linked to Masquerade
booksRiddling trilogy could net you $3m
Arts and Entertainment
Alex Kapranos of Franz Ferdinand performs live
music Pro-independence show to take place four days before vote
News
news Video - hailed as 'most original' since Benedict Cumberbatch's
News
i100
Life and Style
The longer David Sedaris had his Fitbit, the further afield his walks took him through the West Sussex countryside
lifeDavid Sedaris: What I learnt from my fitness tracker about the world
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Business Anaylst

£60000 - £75000 per annum + BONUS + BENEFITS: Harrington Starr: Business Anal...

SQL Implementation Consultant (VB,C#, SQL, Java, Eclipse, integ

£40000 - £50000 per annum + benefits+bonus+package: Harrington Starr: SQL Impl...

Head of IT (Windows, Server, VMware, SAN, Fidessa, Equities)

£85000 per annum: Harrington Starr: Head of IT (Windows, Server, VMware, SAN, ...

Technical Software Consultant (Excel, VBA, SQL, JAVA, Oracle)

£40000 - £50000 per annum: Harrington Starr: You will not be expected to hav...

Day In a Page

'I’ll tell you what I would not serve - lamb and potatoes': US ambassador hits out at stodgy British food served at diplomatic dinners

'I’ll tell you what I would not serve - lamb and potatoes'

US ambassador hits out at stodgy British food
Radio Times female powerlist: A 'revolution' in TV gender roles

A 'revolution' in TV gender roles

Inside the Radio Times female powerlist
Endgame: James Frey's literary treasure hunt

James Frey's literary treasure hunt

Riddling trilogy could net you $3m
Fitbit: Because the tingle feels so good

Fitbit: Because the tingle feels so good

What David Sedaris learnt about the world from his fitness tracker
Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Second-holiest site in Islam attracts millions of pilgrims each year
Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York
Will Self: 'I like Orwell's writing as much as the next talented mediocrity'

'I like Orwell's writing as much as the next talented mediocrity'

Will Self takes aim at Orwell's rules for writing plain English
Meet Afghanistan's middle-class paint-ballers

Meet Afghanistan's middle-class paint-ballers

Toy guns proving a popular diversion in a country flooded with the real thing
Al Pacino wows Venice

Al Pacino wows Venice

Ham among the brilliance as actor premieres two films at festival
Neil Lawson Baker interview: ‘I’ve gained so much from art. It’s only right to give something back’.

Neil Lawson Baker interview

‘I’ve gained so much from art. It’s only right to give something back’.
The other Mugabe who is lining up for the Zimbabwean presidency

The other Mugabe who is lining up for the Zimbabwean presidency

Wife of President Robert Mugabe appears to have her sights set on succeeding her husband
The model of a gadget launch: Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed

The model for a gadget launch

Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed
Alice Roberts: She's done pretty well, for a boffin without a beard

She's done pretty well, for a boffin without a beard

Alice Roberts talks about her new book on evolution - and why her early TV work drew flak from (mostly male) colleagues
Get well soon, Joan Rivers - an inspiration, whether she likes it or not

Get well soon, Joan Rivers

She is awful. But she's also wonderful, not in spite of but because of the fact she's forever saying appalling things, argues Ellen E Jones
Doctor Who Into the Dalek review: A classic sci-fi adventure with all the spectacle of a blockbuster

A fresh take on an old foe

Doctor Who Into the Dalek more than compensated for last week's nonsensical offering