EuroBusiness Media (EBM): Groupe Eurotunnel SE reports results for 2016. Jacques Gounon welcome. You are the chairman and CEO of Eurotunnel Group. Now, you posted strong results for the full year 2016, has the momentum kept up? What are your main takeaways for these 2016 results?
Jacques Gounon: 2016 is the best year in the history of the Group. It’s absolutely fantastic and we achieved something which is better than expected. And look to the figures, regarding the volumes within the tunnel, of course, we made this very public a few times ago, very strong volumes, having said that, on the financial full-year results, the revenues are up by 4% for the Group as a whole. More importantly, EBITDA is up to €514 million, which represents roughly 50% of the total revenue of the Group. And it is, as I mentioned, better than expected, 3% over our own forecast. And more importantly, the net profit, the net profit of the company at the time is €200 million. And you have to keep in mind that nine years ago, it was only €1 million, so you can see that now we are really in a different shape, with a different future than what happened 10 years ago.
EBM: Let’s talk about your three core businesses. Let’s talk perhaps first about Fixed Link. You achieved a growth in sales of 4%, EBITDA is up 6% to €515 million, it looks like the channel tunnel is growing extremely well?
Jacques Gounon: Yes indeed, it’s a unique asset. It’s a beauty regarding the business model. If we consider the volumes, we are outperforming the market. And if I give evidence with the market shares, for cars on our shuttles we reached 55.2% market share, which is incredible. On trucks, once again on shuttles, we reached more than 39% market share. And quality of service is absolutely key for us. And if we look at the reasons why we are so performing in the tunnel; first of all, we had a boost from some specific deliveries, I have in mind for instance parcels from e-trading, it’s booming, you know that. We have the result of this kind of intense transportation between the UK and the Continent, up to 1 million parcels per day that we have seen and it’s coming more than that in the coming years. If we consider another segment, which is Eurostar, Eurostar had a record month in December. They reached 10 million passengers, whatever the difficulties they faced previously. And with the target of opening a new service between London and Amsterdam at the end of 2017, it means that it will bring millions of additional passengers. All in all, we have something which is very strong, volumes are there and more than that, are increasing, once again we are outperforming the markets, we have no perturbation, no disruptions, we are focusing on quality of service, we have a lot of investments in order to deal with more customers and I reaffirm that our target for 2020 is 2 million trucks, 3 million cars. We are on line for that, on track for that, we are very pleased with the Tunnel results.
EBM: And how about ElecLink, the electrical interconnection project, that you acquired fully recently?
Jacques Gounon: ElecLink, so electrical interconnection with an exemption of 25 years from the regulators is something which is really promising. We recently laid the foundation stone, with the UK energy minister, which was really the start of the works. It will take three years, but when it comes under operation in 2020, we have the possibility to sell at least €120 million of revenues with an EBITDA which is in the magnitude of 80%. So once again, it will be a different view, different forecast for the Group at that time. We are focusing on delivering such works with the best suppliers, which are Siemens, Balfour Beatty, Prysmian, we are very comfortable and I would say very excited with this, once again unique asset!
EBM: Regarding your Rail Freight services, you sold in November GB Rail Freight for an enterprise value of €180 million, how is your French Rail Freight service, Europorte, doing?
Jacques Gounon: First of all, of course, we are very proud of the value we have generated with the sale of GB RF, and back to the French part, competitors are public or state-owned companies which are, let’s say, struggling in order to do their own business. We are overperforming these competitors, we are on our business model without any major difficulty. We believe that this business is generating and creating some positive values for the company and we feel, with the team, that we have some possibilities, huge possibilities, in front of us. So, we are very comfortable with this business. So, at the end of the day, the three main core businesses of the Group are working very well, are delivering very well and so we are comfortable and confident for 2017.
EBM: All in all, it looks like your outlook is positive despite all the uncertainties and environmental headwinds, what’s your outlook for 2017?
Jacques Gounon: Quite clear, regarding EBITDA, we target €530 million, like-to-like once again, based on the present values. And for shareholders, which has a significant importance of course is dividends. You know that we have a permanent increased dividend policy and we said that for the exercise 2016 we proposed 20 cents per share to the AGM vote, and in 2017 we are confident to reach a 30 cents level and beyond that, 2018, I would say we are comfortable with a 35 cents dividend per share.
EBM: Jacques Gounon, Chairman and CEO of Eurotunnel, thank you
Jacques Gounon: Thank you.
