M6 Toll operator announces annual loss in excess of £28m
M6 TOLL operator Midland Expressway has announced major losses despite revenues and passenger volumes both increasing by more than 5%.
The group’s annual accounts show the business made a loss of £28.6m for the 12 months to December 30, 2014, although this was an improvement on the previous year when losses were £32.5m.
Despite the losses, MEL said it continued to receive the full support of its debt providers following a successful financial restructuring agreed between itself and its parent company, MMG.
“The terms of the restructuring provide the group with an affordable and stable financing platform for the foreseeable future by extending the maturity date and payment terms of MMG’s term debt and swap obligations until 2020,” it said.
The user figures for the 12-month period show toll revenue rose 5.5% to £69.54m (2013: £65.90m). with traffic volumes up 5.2% to 15,408,000 (2013: 14,652,000).
MEL said it was in no doubt where the increase had come from.
“Traffic volumes have continued to benefit from roadworks in place on the competing section of the M6. The company’s toll revenues benefitted significantly in 2014 as a result,” it said in the annual report.
“The roadworks have continued into 2015 and the company has benefitted from traffic volumes in excess of those seen in 2014.”
However, the company is realistic enough to know that the roadwork-fuelled growth will only be temporary.
It adds: “The improvement to traffic flows for the M6 currently being experienced are expected to end once the M6 works on the competing sections are eventually completed. In the absence of other work programmes, traffic flows and revenues for the M6 Toll longer term may be challenged accordingly.
“It is expected that overall corridor growth will be stimulated by further long term expansion of the ‘Smart Motorways’ concept linking Birmingham to Manchester and the company is well placed to take advantage of such economic uplift.”
Operations have also come in for a belated boost after the Government announced late last month that a much-anticipated link road connecting the M54, M6 and M6 Toll was amongst a £1.8bn package of road measures planned for the West Midlands.
“The company and its consultants are monitoring the position and will engage further with Highways England to mitigate and quantify the risk,” added MEL.
The toll motorway has also been the subject of rumours regarding its free usage. Under proposals being considered as part of the West Midlands Combined Authority, councils could ask the government to compensate MEL to allow the road to be used free-of-charge as a means of easing congestion elsewhere along the West Midlands road network, especially the M6.
