Profits rise for East Coast’s state-owned operator

East Coast operator Directly Operated Railways (DOR) recorded a pre-tax profit of £225.3 million ahead of its return to the private sector next year.

DOR, which is wholly owned by the UK government, paid £216.8 million back to the Department for Transport (DfT) between April 2013 and March 2014 – an increase on the £202.8 million premium paid in 2012-13 – reigniting the debate as to whether the franchise should be taken over by a private operator.

East Coast services have been operated by the government’s Directly Operated Railways since 2009, following the withdrawal of National Express.

First Group, Keolis/Eurostar and Stagecoach/Virgin have all been shortlisted for the new franchise, which starts in 2015.

Doug Sutherland, chairman of DOR, said: “During the year, we continued to make further good progress with the business turnaround of East Coast, and at 91 per cent, we were able to achieve the top customer satisfaction result for a long-distance franchised rail operator, in the 2014 spring wave Passenger Focus National Rail Passenger Survey, matching the result of the autumn 2013 survey.

He added: “The business plan for the remainder of the franchise during 2014/15 will see the good work continuing, with the twin aims of ensuring a successful transfer of the business back to the private sector – in good condition, and maximising the value of the franchise achieved by the government and the taxpayer.”

DOR reported a turnover of £720 million, up from £693.8 million the previous year. Pre-tax operating profit also rose from £5.9 million to £8.4 million.

Passenger numbers increased by 4.5 per cent to 19.9 million.