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

Start your day with The Independent, sign up for daily news emails
Life and Style
A still from the 1939 film version of Margaret Mitchell's 'Gone with the Wind'
David Silva strokes home his and City's second goal
Arts and Entertainment
a clockwork orange, stanley kubrick
The Tesco Hudl2: An exceptional Android tablet that's powerful, well-built and outstanding value

Sarah Silverman (middle) with sister Reform Rabbi Susan Silverman (right) and sister actress Laura Silverman (left) at Jerusalem's Western Wall for feminist Hanuka candle-lighting ceremony
peopleControversial comedian stages pro-equality Hanukkah lighting during a protest at Jerusalem's Wailing Wall
After another poor series in Sri Lanka, Alastair Cook claimed all players go through a lean period
Arts and Entertainment
The Bach Choir has been crowned the inaugural winner of Sky Arts’ show The Great Culture Quiz
arts + ents140-year-old choir declared winner of Sky Arts' 'The Great Culture Quiz'
Life and Style
food + drinkAuthor DBC Pierre presents his guide to the morning after
Life and Style
food + drink
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

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

iJobs Job Widget
iJobs Money & Business

Carlton Senior Appointments: Private Banking Manager - Intl Bank - Los Angeles

$200 - $350 per annum: Carlton Senior Appointments: Managing Producer – Office...

Carlton Senior Appointments: San Fran - Investment Advisor – Ind Advisory Firm

$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...

Sheridan Maine: Commercial Finance Manager

Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Sheridan Maine: Regulatory Reporting Accountant

Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas