LA PLAINE SAINT DENIS, France--(BUSINESS WIRE)--Regulatory News:
SNCF Group (Paris:MLSNP):
WHAT THEY SAID
Frédéric Saint-Geours
Chairman, Supervisory Board, SNCF
Group:
“SNCF Group is continuing its transformation
and strategic development. Its priorities are built into 10-year
contracts between the French State, SNCF Group, SNCF Réseau and SNCF
Mobilités.”
Guillaume Pepy
Chairman, SNCF Group Executive Board, and
Chairman and CEO, SNCF Mobilités:
“We are continuing to
expand, seeking growth where it lies. Thanks to our commercial agility
and exemplary cost controls, we reported a profit this year. SNCF’s
transformation continues—and we continue to serve our customers as we
strive to become a standard-setter for mobility and logistics solutions
in France and around the world.”
Patrick Jeantet
Deputy Chairman, Executive Board, SNCF,
and Chairman and CEO, SNCF Réseau:
“We are stepping up the
pace of our commuter network upgrade and deploying efficient industrial
solutions. Increased use of automation and digital technologies will
spearhead developments in our sector, to the benefit of the railway
operators in our client base. We have the resources to become the world
benchmark in infrastructure management—and we have every intention of
doing so.”
IN 2016, SNCF GROUP CONTINUED TO GROW
Momentum across all business lines
In 2016, SNCF Group reported revenue of €32.3bn, with one-third on international markets. This represented a 2.8% rise (-1.5% at constant scope of consolidation and exchange rates) and was due primarily to a strategic decision to seek growth where it was (Geodis America). Despite the sluggish economy and short-term upsets—terrorist attacks, floods, strikes, slump in steel and grain—that together cut revenue by nearly €700m, SNCF nonetheless posted tangible achievements across all of its business lines:
- In the Paris region, passenger traffic rose 3.7%, thanks in particular to the introduction of a single fare for travel throughout the region. Transilien maintained its on-time arrival performance despite an increase in the number of suspect package incidents.
- On long-distance connections, low-cost multimodal offers were rolled out. Ouigo began serving Tourcoing, Rennes and Nantes. Despite fiercer competition, Ouigo, Ouibus and Ouicar were strikingly successful, with passenger numbers up 76%.
- TGV France won new travellers in 2016, thanks in particular to special low-cost tickets and its new TGV POP offering (TGV traffic up +1.9% excluding strikes, despite competition from road transport and fallout from terrorist attacks).
- Stations were upgraded to meet travellers’ need for retail outlets. Revenue from commercial concessions rose 8%.
- Keolis strengthened its position in Germany (winning new contracts), Shanghai (automated metro), Manchester (light rail), and Australia’s Newcastle (multimodal contract). Over 90% of its contracts in France were renewed, in particular Lyon and Dijon. Keolis crossed the 3-billion traveller mark and generated 50% of its business on international markets.
- SNCF Logistics reported revenue of over €10bn (55% on international markets), buoyed during the year by momentum at Geodis, rail freight in Europe (volume + 12%), STVA (automotive logistics) and resource management (Ermewa). OHL, acquired at the end of 2015 and now operating as Geodis America, confirmed its perfect fit with Geodis and outperformed all of its targets.
Digital technology and door-to-door solutions gather pace
With investments totalling €200m, 2016 marked a turning point for
digital technology.
For operations, digital technologies
improved oversight of infrastructure, trains and stations thanks to
remote diagnostics, supervision, and preventive maintenance, and more. For
passengers, digital solutions meant free WiFi in stations and a rise
in online ticket sales. Voyages-sncf.com reported online sales up 4.8%,
with 9.2 million active customers.
Digital technology made
door-to-door travel easier. Downloads of ID Pass, SNCF
Group’s core app for delivering door-to-door mobility solutions, rose
sharply. And Keolis acquired LeCab, the second largest supplier
of chauffered car rentals in the Paris Region.
In Lyon Keolis
introduced NAVLY, the first public transport service using 100%
driverless electric cars. And Gares & Connexions continued to roll
out multimodal hubs served by trains, buses, metros, light rail,
taxis, bicycles and more.
Investment continues to serve customers better
In keeping with official targets, 2016 saw very heavy investments once again. These totalled €8.6bn, with 65% financed by SNCF. Over 90% were made in France.
The priority was improved safety and performance for the infrastructures used by commuter transport, with €5.2bn invested in the rail network. During the year, all safety programmes gathered pace and efforts to improve maintenance and upgrades continued, including a record €2.8bn renovation programme with:
- Nearly 1,100 km of track upgraded
- Over 1,500 works projects undertaken, half performed at night
- Over 460 switch replacements
SNCF Réseau continued to focus on operational performance: digitizing
and upgrading maintenance, bundling shipments, and optimizing worktime, along
with new equipment and development of industrial partnerships.
Major
engineering works were completed:
- Start-up of the second phase of the high-speed Est line TGV
- Elimination of the rail bottleneck at Bordeaux.
A contract was signed to outfit the future EOLE line—an extension of RER E line to the suburbs west of Paris—with Nexteo, a new, more efficient automated system that ensures better spacing of trains.
An additional €3.4bn was assigned to passenger carriage at SNCF Mobilités, half for rolling stock (including new trainsets: 22 for Francilien, 110 for TER regional service, 10 for TGV high-speed service, and 4 for Eurostar).
SNCF—a major player in France
With €1.64bn in total procurement (excluding track access fees,
SNCF Réseau public-private partnerships, and Geodis sub-contracting),
SNCF Group is responsible for 164,000 indirect jobs in France, through
31,000 suppliers— more than 20,000 of them mid-size, small or very small
companies (25% of total budget). This gives it a vital
economic role in French regions, and is why the Group has a very
active CSR (Corporate Social Responsibility) policy.
SNCF
Réseau has established long-term partnerships with its industrial
suppliers to accelerate full-scale deployment of works.
SNCF—a leading employer
In 2016, SNCF Group hired over 12,400 new employees in France, over half in the rail sector.
IN A SLUGGISH ECONOMY, GROWTH WAS DRIVEN BY SNCF GROUP’S RESPONSIVENESS, EXEMPLARY CONTROL AND ADAPTABILITY, AND PRODUCTIVITY GAINS
Solid results
Development came against a backdrop of persistently weak growth in France and Europe, and despite a serious of upsets—a slump in tourism due to terrorist attacks, serious flooding, and strikes in spring. It was made possible by strict budgetary and financial discipline throughout the Group.
SNCF Group reported EBITDA of €4.1bn in 2016, or 12.8% of revenue, down from 2015 due primarily to lower margin on passenger rail business. Despite the difficult environment, contributing factors were its continued cross-functional performance plan, an operational performance plan at SNCF Réseau, and a plan focusing on operations and sales at SNCF Mobilités. Together these generated full-year savings of €825 million, above the €750 million target. More specifically, factors included optimized purchasing for network upgrades, reduced production costs, a very responsive and agile sales policy, adjustments in product offering, efforts to fight carrier fraud, and lower structural costs at Group level.
Keolis and Geodis, the Group’s two largest subsidiaries, both reported higher profitability. Taken together, measures aimed at tightening financial oversight allowed SNCF to meet its targets and report net profit of €567m.
Throughout the year, SNCF Group maintained an unrelenting focus on two priorities: safety and customer satisfaction. In safety, efforts paid off, with the register of SSIs (Special Safety Incidents) showing a 21% decline in 2016—the steepest fall in 15 years. Customer satisfaction is high overall at above 80% for rail operations.
The Group also reviewed its asset position, selling 50% of its shares in Akiem (resource management) for a capital gain of €94m, and disposing of €180m in non-strategic property during the year.
Effective, sustainable financial management
In 2016, SNCF Réseau became the world’s largest rail infrastructure
manager and Europe’s first transport company to issue a Green Bond,
in an amount of €900m. Funds raised were earmarked for long-term
upgrades. The company also launched a new US-dollar denominated bond
through a US$1 billion public offering, placed primarily in North
America, Asia and the Mideast. Full-year, SNCF Réseau raised a total of
€4.7bn.
For its part, SNCF Mobilités issued a successful €1bn
bond issue at the outset of 2017 at very favourable conditions.
Together these two bond issues illustrate the two companies’ excellent
financial management and their creditworthiness, which was
unanimously acknowledged by investors.
Debt under control at SNCF Mobilités
The same strict discipline held financial debt at SNCF Mobilités at €7.9bn, while financing development and heavy investments. SNCF Réseau’s net financial debt stood at €44.9bn (redemption value: €42.0bn).
2017 OUTLOOK: ACCELERATE AND EXPAND MOBILITY OPTIONS FOR CUSTOMERS IN AN ECONOMY WHERE CONTINUED TIGHT MANAGEMENT IS ESSENTIAL
Economic and geopolitical uncertainty
Growth prospects for 2017 call for caution, due in particular to
uncertainty hanging over tourism as well as flagging international
trade, where growth is the slowest it has been since 2009. During the
year, certain sectors need recovery: rail freight in France, plus other
rail operations hit by increasingly fierce competition.
In this
uncertain environment, SNCF Group is pursuing its bold objectives while
doubling down to promote cost-cutting and efforts to boost productivity.
Excellence across all business lines
The Group’s business lines will continue to adjust operations to meet customer expectations, while maintaining their focus on safety, security, outstanding service and information, through increasingly customized client relationships, with the development of door-to-door mobility solutions for passengers and end-to-end service for shippers.
SNCF accelerates customer mobility
With a high-performance rail network
- Ramped up investment outlays (€5.3bn) that make commuter network upgrades a priority
- Expanded industrial transformation and scaled up innovation
- New rail control towers at Paris-Gare de Lyon, Vitry and Saint Denis
- Clear economic and financial trajectory thanks to 10-year agreement with the French State* and ambitious on-going performance plans.
With new lines serving French regions
- Bordeaux will be just 2h04 from Paris and Rennes 1h27 from Paris when new high-speed lines serving Brittany/Pays de la Loire and Southern Europe/Atlantic enter service in July 2017.
- Start-up of Nimes-Montpellier by-pass at year-end 2017.
- Launch by Keolis of automated metros in Hyerabad (India) and Shanghai (China)
- Launch of a rail-motorway service between the UK and Spain via Calais-Le Boulou
- Stronger presence of SNCF Logistics in Europe, Asia and the USA.
With stations and rolling stock
- Completion of renovation and upgrades at stations in Bordeaux, Lille, Grenoble and Angoulême
- Orders placed for next-generation RER trainsets for Transilien and initial projects in Grand Paris project
- Massive order for new trainsets for Intercités
Digital and door-to-door services
- Development of new services from Keolis: MyBus with Le Cab and Navya
- Deployment of door-to-door transport, with ID Pass, Ouicar Connect and more
- On-going deployment of digital technology, with free WiFi on TGV Connect trainsets and co-working spaces in stations.
* Approved at SNCF Réseau board meeting on 20 December 2016; signature to follow after a non-binding opinion from ARAFER.
2017—a year of strict financial management
Projections call for organic growth in revenue to be moderate, but with major gains in efficiency as performance plans targeting structural costs—and all business activities—are continued.
Dedicated will to win
- Continued profitable growth in businesses, with a focus on international markets
- Drive to set the standard in mass transit
- Heavy investment in shared and low-cost mobility
- Heavy investment to continue in 2017, totalling €9.0bn, including 60% financed by SNCF.
SNCF—hiring now
SNCF Group will hire over 10,000 new employees in 2017, over half of them in the rail sector.
SNCF GROUP: 2016 KEY FIGURES
|
CONSOLIDATED DATA (IFRS) |
2015 | 2016 | ||||
| Revenue | 31 393 | 32 273 |
-1.5% at constant
|
|||
| Change—2016/2015 | +2.8% | |||||
| Gross profit (EBITDA) | 4 425 | 4 144 | ||||
| As % of revenue | 14.1% | 12.8% | ||||
| Financial profit | -1 500 | -1 491 |
Financial statements at 31 December
|
|||
|
Net profit (attributable to equity holders of parent company) |
-12 2281 | 567 | ||||
| Self-financing capacity | 2 577 | 2 269 | ||||
| Total investments | 8 171 | 8 573 +5.0% | ||||
| Including SNCF capital investment | 5 645 | 5 525 |
KEY FIGURES—SNCF MOBILITÉS & SNCF RÉSEAU
Figures as
presented in the financial statements of SNCF Mobilités and SNCF Réseau
|
CONSOLIDATED DATA (IFRS) |
SNCF Mobilités | SNCF Réseau | ||||||||
| 2015 P | 2016 | 2015 P | 2016 | |||||||
| Revenue | 29 296 | 30 517 | 6 526 | 6 441 | ||||||
|
Change—2016/2015
(at constant scope of consolidation and exchange rates) |
+4.1%
(-1.4%) |
-1%
(-1%) |
||||||||
| Gross profit (EBITDA) | 2 401 | 2 284 | 2 028 | 1 889 | ||||||
| As % of revenue | 8.2% | 7.5% | NM | NM | ||||||
| Financial profit | -265 | -301 | - 1 225 | -1 173 | ||||||
| Net profit (attributable to equity holders of parent company) | -2 1871 | 511 | -10 0411 | -120 | ||||||
| Self-financing capacity | 1 707 | 1 506 | 2 082 | 1 869 | ||||||
| Total investment | 3 179 | 3 392 | 5 116 | 5 2312 | ||||||
| Including SNCF capital investment | 1 845 | 1 961 | 3 920 | 3 614 | ||||||
| Free cash flow | 179 | -27 | -2 951 | -2 784 | ||||||
| Net indebtedness (IFRS) | 7 772 | 7 974 | 42 260 | 44 9363 | ||||||
P: Pro forma
1 Adjusted for value of assets when new
unified SNCF Group was created
2 Including work on High
Speed Line Tours-Bordeaux high-speed line, this totals €5,244m
3
Net endebtedness in redemption value totals €42.0bn vs €39.3bn in 2015
BUSINESS PERFORMANCE
Performance as presented in the financial statements of SNCF Mobilités and SNCF Réseau
2016 REVENUE
| € MILLIONS | 2015 P | 2016 | change |
At constant |
||||
| SNCF RÉSEAU | 6 526 | 6 441 | -1.1% | -1.1% | ||||
| Including track access fees billed to SNCF Mobilités | 3 779 | 3 502 | ||||||
| SNCF MOBILITÉS | ||||||||
| SNCF Voyageurs | 14 974 | 15 136 | +1.1% | -1.9% | ||||
| Including Voyages SNCF | 6 746 | 6 816 | +1.0% | -4.3% | ||||
|
Including SNCF Gares & Connexions |
356 | 443 | +24.6% | +11.6% | ||||
| SNCF Logistics | 9 070 | 10 040 | +10.7% | -0.7% | ||||
| SNCF Keolis | 4 907 | 4 978 | +1.4% | -0.2% |
2016 GROSS PROFIT (EBITDA)
| € MILLIONS | 2015 P | 2016 | ||
| SNCF RÉSEAU | 2 028 | 1 889 | ||
| As % of revenue | NM | NM | ||
| SNCF MOBILITÉS | ||||
| SNCF Voyageurs | 1 626 | 1 319 | ||
|
As % of revenue
(at business scope level) |
10.6% | 8.5% | ||
| Including Voyage SNCF | 867 | 633 | ||
|
As % of revenue
(at business scope level) |
11.7% | 8.5% | ||
|
Including SNCF Gares & Connexions |
220 | 206 | ||
|
As % of revenue
(at business scope level) |
18.2% | 16.7% | ||
| SNCF Logistics | 295 | 490 | ||
|
As % of revenue
(at business scope level) |
3.2% | 4.8% | ||
| SNCF Keolis | 261 | 294 | ||
|
As % of revenue (at business scope level) |
5.2% | 5.8% |
P: Proforma
2016 was a difficult year, with operations affected by terrorist attacks, strikes and a persistently sluggish economy in France. In passenger transport, aggressive competition was fueled by low oil prices (ride-sharing, low-cost flights). In freight, low prices were compounded by the fragile French economy (crisis in steel, worst grain harvest in 30 years).
SNCF Réseau’s 2016 financial report is available at: www.sncf-reseau.fr
SNCF Mobilités’ 2016 financial report is available at:
www.sncf.com/ressources/reports/sncf_mobilites_2016_financial_report.pdf
About SNCF Group
SNCF is a global leader in passenger and
freight transport services with revenue of €32.3 billion in 2016, of
which one-third on international markets. With 260,000 employees in 120
countries, SNCF draws on its foundations in French rail and on its
extensive experience as an architect of transport services. It aims to
become the benchmark for mobility and logistics solutions, both in
France and worldwide. SNCF has six core businesses: SNCF Réseau
(management and operation of the French rail network); SNCF Voyageurs
(commuter transport in the Paris region, regional and inter-city public
transport, high-speed rail in France and Europe); SNCF Gares &
Connexions (management and development of stations); SNCF Logistics
(freight transport and logistics worldwide); Keolis (mass transit and
public transport in Europe and around the globe); and SNCF Immobilier
(management and optimization of SNCF property and land assets). www.sncf.com
About SNCF Réseau
Within SNCF Group, a public rail transport
group and one of the world’s leading mobility and logistics players,
SNCF Réseau manages, maintains, develops and sells access to the French
rail network. It guarantees the safety and performance of over 30,000 km
of track, including 2,100 km dedicated to high-speed rail. SNCF Réseau
guarantees access to the network and to service infrastructures for its
38 customers in transparent, non-discriminatory conditions. Twenty-six
railway operators use the network and 12 other companies, called
authorized users (combined transport operators, ports, etc.) order track
slots that they then turn over to the railway operator of their choice.
SNCF Réseau is the second larges public investor in France, with 55,000
employees and 2016 revenue of €6.4bn (including €3.5bn in track access
fees from SNCF Mobilités).
www.sncf-reseau.fr/en/investing-for-the-rail-network-of-the-future
About SNCF Mobilités
Within SNCF Group, one of the world’s
leading mobility and logistics players, SNCF Mobilités is a transport
operator with revenue of €30.5 billion in 2016, of which one-third comes
from international markets. The company has 194,000 employees, is
present in 120 countries, and aims to become the world benchmark for
excellence in mobility and logistics services. SNCF Mobilités has four
business units: SNCF Voyageurs (commuter transport in the Paris region,
regional and inter-city public transport, high-speed rail in France and
Europe); SNCF Gares & Connexions (management and development of
stations); SNCF Logistics (freight transport and logistics worldwide);
and Keolis (mass transit and public transport in Europe and around the
globe). www.sncf.com