CZECH Railways (ČD) reported a consolidated loss of Koruna 4.1bn ($US 194.3m) in 2020 as the Covid-19 pandemic caused passenger numbers to fall by a third to 118 million across the year as other subsidiary companies also reported losses.
Passenger numbers were particularly suppressed during the initial stages of the crisis when only 10% of normal ridership was recorded. In addition, ČD spent Koruna 166m on disinfectants, protective equipment and intensive cleaning of trains. The state compensated Koruna 32m of these extra costs.
Additional measures to cut costs were hindered by ČD continuing to operate trains at the height of the crisis to serve passengers who needed to travel, which CEO and chairman of ČD’s board of directors, Mr Ivan Bednárik, says is the main reason the company recorded such a significant loss.
ČD says its management will continue to implement necessary cost-saving measures and structural changes this year while strengthening liquidity and continuing to invest in new vehicles and repairs.
ČD says other group companies, ČD Cargo, ČD Travel and the Transport and Education Institute, also reported losses during the year contributing to the overall result.
Freight
ČD Cargo reported a loss of Koruna 248m, transporting 4 million tonnes less freight in 2020 than in 2019. Commodities most significantly affected were solid and liquid fuels, automotive, iron and the combined transport of goods to and from China. This decline was consistent with overall falls in output in individual sectors.
“From my point of view, ČD Cargo has clearly had the most difficult year in its independent existence,” says Mr Tomáš Tóth, chairman of the Board of Directors of ČD Cargo. “On the one hand, we were struggling with an unexpectedly sharp drop in demand for our services and, in difficult conditions, we tried to provide our customers with unclaimed transport in the maximum possible quality.
“On the other hand, we were still thinking about the future. In these difficult times, we did not permanently reduce our capacities and, on the contrary, fully focused on further expanding the territorial scope of the ČD Cargo Group. After Austria, we also fully established ourselves on the German market last year and established a new subsidiary in Hungary.”
Tóth adds that ČD Cargo cut more than 500 administrative and operational employees during the year while the operator discontinued more than 1200 life-expired wagons and several dozen locomotives. “A more drastic intervention in capacity would already mean a reduction in the range of our services, which is unacceptable from the point of view of our strategy,” Tóth says.
“The clear goal was for the company to return to black numbers in 2021. The first quarter of this year already indicates to us that we have set out on the right path and that our measures are working.”
