The financial stability of our company is one of our strategic objectives. Throughout the first nine years of its existence, Infrabel has succeeded in its aim of avoiding financial deficits.
The SNCB Group restructuring of 1 January 2014 not only brought about major changes in relation to Infrabel's activities, but also fundamentally altered the financial situation for Infrabel as a result of taking over a portion of the financial debt from the former SNCB Holding, partially offset by taking over a portion of the public funding.
It is Infrabel's firm intention not to allow this historic debt to grow and even, if possible, to reduce the debt. Maintaining financial stability each year will more than ever be the long-term underlying theme of all decisions over the coming years. This applies to both the allocation of the available resources to necessary investments and current operating expenditure.
Regional Express Network fund
Regional Express Network
Capacity expansion (incl. HST)
Consolidation of signal boxes (incl. New Traffic Management)
ETCS & TBL1+
Means of production
In 2014 Infrabel posted a positive gross operating income (EBITDA) of EUR 121 million. This result needs to be high enough to cover the financial costs of the historic debt, and also needs to provide a buffer for the hard to predict effect of provisions under IFRS international accounting standards.
The overall result (EBT) for 2014, after deducting the above costs and provisions is EUR -3.7 million and so remains close to the targeted break-even result.
In 2014 Infrabel invested EUR 1.073 billion in the railway network.
Of the total investment budget, in 2014 Infrabel invested EUR 784.1 million in the railway network in order to improve safety and punctuality.
Financial stability is guaranteed by a strict budgetary policy that is based on the available resources and requires all actions to be evaluated and monitored. Despite the first round of cuts to public funding in 2014, and the unfavourable economic climate, Infrabel managed to come close to a break-even result once more last year. The investment budget is strictly adhered to on an annual basis and operating costs were subjected to scrutiny for savings on external expenditure and more efficient business processes.
The severe budget cuts imposed by the new government mean Infrabel faces a new challenge over the next few years. The investment and operating budgets for 2015 were drawn up with serious attempts to find savings, and controls on expenditure were reinforced in order to achieve stability. A financial plan and a multi-year investment plan for the period 2016-2019 are being prepared, with all additional savings already announced factored in. This will also entail difficult choices in terms of investment priorities, along with a review of internal processes and organisation.
The financial debt is being closely tracked by a motivated treasury team that is well aware of the importance of an excellent financial rating for Infrabel.
With investments totalling 1.073 billion euros, Infrabel is once again one of Belgium's biggest investors. Infrabel is one of the transport sector's biggest players and its investments support the development of the Belgian economy.
In 2014, we not only invested the government investment grant, but also part of our own retained earnings from previous years, in maintaining, renewing and expanding the Belgian railway network.
Over the next few years, the Belgian railway network still requires substantial investment to improve the safety of rail transport and to renew and maintain the existing infrastructure in good condition. Infrabel has to reconcile these requirements with the precarious economic situation and increased pressure on government resources.
The budget savings required over the next few years mean that the investment plan approved in 2013 for the period 2014-2025 needs to be fundamentally revised. A revised investment programme will shortly be created for the period 2015-2019, for which the priorities of the different projects need to be evaluated, with absolute priority always being given to investment in safety on the railways.
Professional supply chain management is of great importance to financial performance and efficient operations at Infrabel. As part of our maintenance and renovation strategy, it is essential that the right materials are available in the right quantities at the right time. The progress of major investment projects also depends to a great extent on competent supply chain management. Significant progress has already been made in modernising and reorganising warehouses and developing Logistic Centres for Infrastructure (LCIs). This policy will be continued over the next few years as it makes the current stock situation clearer and reduces stocking volumes.