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Debt buries Eurotunnels fledgling profit

EUROTUNNEL MADE its first operating profit in 1997, despite limited capacity for the first half of the year following the Channel Tunnel fire.

And despite the current uncertainty over the fate of the Channel Tunnel Rail Link, Eurotunnel directors still believe the current target traffic forecasts are achievable.

But while end of year results revealed an operating profit of 57M, up from an operating loss in 1996 of 35M, interest charges of 633M on Eurotunnels massive 8.9bn debt and losses due to the strength of Sterling meant a net loss for 1997 of 611M.

Traffic figures for the year were up on those for 1996. Eurostar passengers increased by 20%, with rises of 11% and 16% for Le Shuttle and freight traffic. But the figures fell way short of forecasts published last May in the companys prospectus, with only freight 4% above predictions.

In terms of the impact of the CTRL on us, that will be beyond 2006 when our guaranteed minimum usage charge runs out, a spokeswoman said. With the information we have today we still believe our traffic growth and revenue projections to be reasonable.

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