Tram owner reports £18 million in losses, despite big increase in passengers
The company did make an increase in turnover and profit
Matthew BunnContent Editor
Tramlink Nottingham has reported an £18m loss (Image: Ian Hodgkinson/Picture It)
The company that owns Nottingham's tram system made further losses of more than £18 million in the last financial year, despite an increase of 1.4 million in passenger numbers.
Tramlink Nottingham, which holds the contract for the project from Nottingham City Council, was more than four weeks late filing its accounts for the year to 31 March 2018.
The report, released today, shows a total loss for the year of £18.79 million for the 2018 financial year, which is a fall in the loss incurred in the previous year of £48.5m.
The figures come despite the company, a private finance initiative, also reporting a rise in turnover from £60.6m to £61.5m and an increase in passengers from 16.4m in 2017 to 17.8m last year.
According to the accounts Tramlink did make an overall gross profit of £15.2m, a rise from £13.3m in 2017.
A Tramlink Nottingham spokesman confirmed the company had made improvements in passenger numbers, passenger miles - 117.2m for 2018 - and profitability.
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He said there was continued growth in the half year to September 2018 of passengers and 'service punctuality' stood at 95 per cent.
The spokesman added: "We are delighted that passenger numbers continue to rise and would like to thank our customers for their continued and growing support.
"Over the past 12 months, improving the customer experience has continued to be a high priority and we value the feedback we receive. It helps us shape our plans for the future and we are looking forward to sharing some exciting new initiatives with customers over the coming months.
"In common with any Private Finance Initiative (PFI) concession, commercial lending is used to fund the delivery of new infrastructure and interest payments are profiled throughout the course of the contract in accordance with agreements with the lenders.
"In Tramlink's case, the concession's commercial debt reflects the front-end costs incurred in constructing the two new tramlines and buying new trams. The company's loss before taxation of £18.8m (last year £48.5m) reflects this and is stated after taking into account interest charges of £31.8m.
"During the year the company fully serviced all third-party debt requirements and repaid £15.2m of loans."
The accounts do also show the amount owed to creditors within one year also increased to £307m in 2018, from £24m in 2017. This includes more than £277m in bank loans.
The accounts have been released after commuters were faced with six days of disruption on the network, between January 20-26.
This included technical faults but also circumstances outside of the network's control, which as a bus becoming stuck on the tracks on January 21, which led to no tram services running from Old Market Square to the Royal Centre.
Councillor Dave Liversidge, Portfolio Holder for Transport at the City Council said: "The tram is an integral part of Nottingham's world class public transport network and we're really pleased the use of the tram network is continuing to grow.
"The nature of Tramlink's accounts appear typical for the contractual arrangements that are in place and we are confident they will continue to deliver a successful tram service for the city."
Tramlink won the 22-year contract from the city council in December 2011 to build the new extensions to the city's tram network and operate the service under the NET brand.
It is made up of various partners and while nobody actually works for Tramlink, it has a board of directors.
Across the entire network, there are about 290 employees including drivers, administration staff and travel officers.
Old Market Square