24 April 2002
KCRC substains growth in 2001 
 
The Kowloon-Canton Railway Corporation (KCRC) recorded sustained progress and modest growth in 2001, with net profits going up by 6.5% to $2,436 million.
A spokesman for the Corporation said, "As a Corporation we demonstrated, once again, as we did in 1998 and 1999, that we are capable of sustaining growth even during an economic downturn."
Despite the decision to freeze fares for the fourth year in a row, fare revenue grew 1.5% to $3,963 million last year. Freight, rental, advertising and other revenue also grew 1.1% to $834 million.
Operating cost grew 1.9% to $2,885 million in 2001 and operating profit increased by 0.6% to $1,912 million. As a result of increased expenditure, the operating margin decreased slightly from 40.2% in 2000 to 39.9% during the year.
"Although the Corporation's profits grew to their highest level in six years, this was mainly due to the growth in net investment income by 62.3% to $490 million during the year," he said.
The spokesman added that the growth rate of cross-boundary ridership had slowed down significantly from the years of double-digit growth in the period 1996 to 2000 to only 3.4% in 2001, during which the average daily ridership was 236,800 passenger trips.
"This is a cause of concern as cross-boundary patronage represents the Corporation's single largest source of revenue.
"We are therefore looking at opportunities for revenue diversification, such as from advertising in tunnels and on embankments, and for cost containment," he said.
Turning to operating results, the spokesman said, "East Rail saw a return to the 1997 level of domestic patronage, with a marginal rise of 0.6% over the year before to reach an average daily ridership of 562,500 passenger trips.
"Results for Light Rail were mixed during the year. The number of passengers travelling on Light Rail declined but this was offset by a rise in the number of commuters using Light Rail buses," he said.
As a result, East Rail's total patronage for 2001 edged up 1.4% to 292 million passenger trips while that of Light Rail slipped 0.8% to 117 million passenger trips.
The spokesman added, "As in previous years, the Government, which is the sole shareholder of KCRC, decided to forego a dividend in 2001, allowing net profits to be deployed towards the cost of building West Rail, Phase I, the East Rail Extensions and other new railway projects.
CONSOLIDATED PROFIT AND LOSS ACCOUNT (HK$ MILLION) FOR THE YEAR ENDED 31 DECEMBER 2001
 

2001

2000

Fare revenue     3,963 3,906
Freight, rental, advertising and other revenue

    834

   825

Total revenue 4,797 4,731
Less: Operating costs before depreciation 

2,224

2,160

Operating profit before depreciation  2,573 2,571
Depreciation    

   661

   670

Operating profit before net investment income 1,912 1,901
Net investment income    

   490

   302

Profit after net investment income  2,402 2,203
Profit on property development   24 87
Share of profit/(loss) of associate     

   11

   (1)
Profit before taxation    

2,437

2,289

Taxation    

   1

   1

Profit after taxation   2,436 2,288
Transfer to development reserve    

   24

   87

Retained profit for the period    

2,412

2,201

 
CONSOLIDATED BALANCE SHEET (HK$ MILLION) AS AT 31 DECEMBER 2001
 

2001

2000

ASSETS   
Fixed Assets 13,745 13,236
Construction in progress West Rail, Phase I 25,530 16,491
Others 1,396 909
Deferred expenditure                                           East Rail Extensions 4,106 1,104
Others 104 -
Property under development 739 91
Interest in associate 23 16
Loan to subsidiary 1,316 602
Investments in securities 27,752 27,789
Stores and spares 186 171
Properties held for resale 11 -
Interest receivable 709 886
Other receivables 428 508
Tax recoverable - 19
Cash and cash equivalents

6,473

8,597

 

82,518

70,419

LIABILITIES
Interest payable 436 434
Other payables 2,490 1,527
Accrual for capital expenditure 2,694 2,493
Interest-bearing borrowings 16,831 16,395
Insurance provision - 225
Deferred income 454 444
 

22,905

21,518

NET ASSETS

59,613

48,901

 
CAPITAL AND RESERVES
Share capital 39,120 31,120
Development reserve 6,441 6,417
Investment property revaluation reserve  176 242
Investment revaluation reserve  133 16
Retained profits 13,743 11,106
 

59,613

48,901

KEY STATISTICS FOR THE YEAR ENDED 31 DECEMBER 2001
2001 2000
East Rail
Total number of passengers (million) 292 288
Daily average number of passengers (thousand) 799 788
Proportion of total franchised public transport boarding in Hong Kong 8.7% 8.8%
HK$ per passenger carried
        Fare revenue 11.66 11.65
        Operating costs excluding depreciation  4.48 4.55
        Operating results 7.18 7.10
 
Light Rail
Total number of passengers (million) 117 118
Daily average number of passengers (thousand) 319 323
Proportion of total franchised public transport boarding in Hong Kong 3.5% 3.6%
HK$ per passenger carried
        Fare revenue 3.56 3.59
        Operating costs excluding depreciation  3.94 3.86
        Operating results (0.38) (0.27)
Note:
The financial information set out above does not constitute the Corporation's statutory financial statements for the years ended 31 December 2001 or 2000 but is derived from those financial statements.  The auditors have expressed an unqualified opinion on those financial statements in their report dated 25 February 2002.