UK markets closed
  • NIKKEI 225

    -584.99 (-1.97%)

    +29.58 (+0.10%)

    -0.83 (-1.31%)

    +7.90 (+0.45%)
  • DOW

    -315.30 (-0.93%)

    +330.75 (+0.83%)
  • CMC Crypto 200

    +33.49 (+2.71%)
  • ^IXIC

    -171.59 (-1.23%)
  • ^FTAS

    -76.60 (-1.92%)

Channel Tunnel group Getlink's profits plunge on pandemic travel bans

  • Oops!
    Something went wrong.
    Please try again later.
·2-min read
The logo of Channel tunnel operator Getlink, formerly known as Eurotunnel, is seen during the company's 2018 annual results presentation in Paris
  • Oops!
    Something went wrong.
    Please try again later.

(Reuters) - The operator of the Channel Tunnel on Thursday posted a 41% slump in its core profit, as government travel restrictions during the coronavirus pandemic brought traffic grinding to a halt in Britain's last year in the European Union.

Getlink, which operates the 50-kilometre railway tunnel that connects France with Folkestone in Kent, posted a core profit of 328 million euros ($398 million), down 41%, following a 24% drop in sales.

Getlink did not give an earnings outlook for 2021 but proposed a modest dividend of five cents per share, which it plans to increase once the pandemic is over.

Getlink has been shaken by COVID-19 travel restrictions that battered international traffic during 2020, and faces more turbulence ahead now that Britain's EU divorce bill has taken effect.

For an interactive graphic, click here:

"As soon as travel restrictions are lifted, customers return very, very quickly," said chief executive Yann Leriche said in a call late on Wednesday.

After British Prime Minister Boris Johnson outlined a plan to lift international travel restrictions from May 17, Leriche said Getlink had booked a 200% hike in reservations compared with the previous day.

He added that Getlink was working with the British government and alongside air and ferry operators to put in place measures that would enable a return to normal from late spring.

Despite disruptions from COVID-19 and Brexit, the firm improved its net cash by the end of the year and managed to reduce its net financial debt, helped by tight operations and spending, which it plans to continue this year.

"We will reduce our operating expenses to what is strictly necessary for the operation of our services," said Leriche.

He added that Getlink has been adapting its services to existing demand and making use of furlough and partial unemployment provisions in both the UK and France, while maintaining jobs.

($1 = 0.8236 euros)

(Reporting by Sarah Morland in Gdansk; Editing by Hugh Lawson)