Major State investment in railways appears to be paying off for Irish Rail, which will shortly report its largest operating surplus for five years of €9 million.
The company reported an operating deficit of €17.5 million as recently as two years ago, but it has benefited from better cost control and increased State investment, including the delivery of 80 new commuter railcars to Dublin's commuter routes in 2004.
In 2003 it reported a €92,000 operating surplus.
The results come at an important time for the company, with the Government's five-year investment programme for the railways coming to an end. This programme began in 1999 and focused on getting extra capacity and improving safety. Last night the chairman of Irish Rail, Dr John Lynch, said both these objectives had been achieved.
It is understood the company is projecting an operating surplus of €15 million for 2005. The company is expected to announce its formal results as part of an overall CIÉ presentation shortly. In the section dealing with Irish Rail, the company is expected to point to strong cost control.
The company will state that despite significant inflationary pressures, expenditure has been held almost constant since 2002.
The €9 million surplus is arrived at after taking account of the State subvention to the company of €171 million. Under an agreement with the Department of Transport, Irish Rail receives a 5 per cent increase in its subvention annually.
The company has also allowed for a €27.3 million exceptional charge for restructuring costs and additional pension contributions.
While an increase in services and frequencies benefited the company, the continuing works on the DART deprived the company of significant income.
The company also suffered a blow recently when the Minister for Transport, Mr Cullen, said he was not accepting a CIÉ request for an 8 per cent increase in fares for the group's three companies, including Irish Rail.
An increase of 3.5 per cent was agreed instead for 2005.
Despite this, the 2004 figures will be encouraging for the Government, which is trying to promote greater use of public transport. The company's turnover was up from €213.2 million to €216.4 million, while employee numbers have fallen from 5,580 to 5,269.
CIÉ and Irish Rail chairman, Dr John Lynch, said: "After decades of underinvestment in every aspect of our rail service and network, we have now come to the end of the 1999-2004 phase of investment, during which we have delivered real improvements for our DART and commuter customers, and updated our track, signalling, level crossings, stations and rail communications on Intercity routes.
"We now progress to our second phase of investment in the next four years, which will see continued expansion of services for DART and commuter customers, and dramatic improvements in quality and frequency of service for our Intercity customers".
