Thursday, 24 April 2014

ČD Cargo reports CZK 2bn loss

17 January 2013

Prague, Jan 16 (CTK) - Freight railway carrier CD Cargo will end last year with an operating loss around Kc200m but an up to Kc2.053bn loss before tax, according to preliminary results, Petr Zaluda, Ceske drahy CEO and CD Cargo's board chairman, informed deputies from the economic committee yesterday.

Zaluda admitted that the bottom line did look awful. However, this is the result of operations which have nothing to do with cash flow, he said.

The figure includes, for example, a Kc535m reserve for the case of layoffs. Reappraisal of assets, in particular the rolling stock that the company acquired in 2007, was equal to Kc1.6bn.

"It is not so bad, it is not for insolvency or bankruptcy," Transport Minister Zbynek Stanjura, present at the economic committee's meeting, commented on the data.

Zaluda did not rule out that the company would lay off up to 2,500 employees next year within its restructuring process. It also wants to scrap thousands of idle railway wagons and sell railway vehicles that it does not need.

He expects this year's operating result to be around zero and the loss before tax could be Kc231m.

Zaluda complained, among other things, about high fees for the use of railway tracks. The fee for freight railway transport in the Czech Republic ranks among the highest in Europe, while lorries pay less for the use of roads, he added.

CD Cargo, 100-percent owed by national railway operator Ceske drahy, transported 73.27 million tonnes of goods last year, down by 7 percent year-on-year, company representative Lada Hlavackova told daily E15.

The figure confirmed forecasts from the middle of last year, when former CD Cargo CEO Gustav Slamecka talked about markedly falling volumes of coke and brown coal. Last year's business results of CD Cargo have not been released yet. In December, the company estimated its operating loss at about Kc230m-230m.

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