Annual Report 2010 Metroselskabet I/S Thousands of Copenhageners attended Open Drawing Office events in 2010 Annual Report 2010 METROSELSKABET 3 Table of Contents TABLE OF CONTENTS Résumé and Outline for 2010 4 ANNUAL ACCOUNTS Metroselskabet's Board of Directors Financial Highlights 5 Accounting Policies 34 and Board of Executives 56 Profit and Loss Account 39 Endorsements 59 DIRECTORS' REPORT Balance Sheet 40 Appendix 63 Finances 6 Cash Flow Statement 42 Company Management 8 Notes 44 Metro Operation 16 Cityringen 20 Social Responsibility 26 Annual Report 2010 Résumé and outline for 2010 4 METROSELSKABET RÉSUMÉ AND OUTLINE FOR 2010 THE METRO IS GROWING READY TO CONSTRUCT CITYRINGEN suburban (S-train) rail tracks. At both In 2010, the Metro was used by 52 In 2010 Metroselskabet also con- locations, areas must be cleared to pro- million passengers. This is just over 2 cluded the work on the major invita- vide sites for the new Metro stations. million more passengers than in 2009, tions to tender for the construction At a total of 21 construction sites util- equivalent to growth of 5.3 per cent. and delivery of trains and operation ity grids have been re-aligned to make The growth in the number of passen- systems, respectively, which also in- way for the construction of the capi- gers thereby exceeded expectations. cludes the operation of Cityringen. tal's coming new Metro system, called In March, the Metro was nomi- The winners of the contracts were Cityringen (the city circle line). nated “Best Metro” and “Best Driver- announced in November, and in less Metro” at the metro industry's December the recommendation con- FUTURE-ORIENTED ORGANISATION annual world congress, which took cerning the basis for the conclusion of With the conclusion of the invitation place in London. Metroselskabet won the contracts was approved by Metro- to tender and the contract negotia- the awards due to its high operational selskabet's owners. The contracts were tions, and on the brink of the start stability, 24-hour operation, and high signed on 7 January 2011. of the civil engineering works for passenger satisfaction - and for the A large number of new construc- Cityringen, in 2010 Metroselskabet plans to expand the existing system tion sites opened in 2010, so that the undertook major organisational ad- with the addition of Cityringen (the works in preparation for the major justments in preparation for the engi- city circle line). engineering works, and the extensive neering works that are to commence In 2010 the Metro ran on time archaeological excavations, could get in 2011. for 98.2 per cent of all departures. underway. Many new employees have joined Punctuality was thereby higher than At Enghave Plads in Vesterbro the the company, so that Metroselskabet expected, despite very severe winter country's largest sewerage pipes were has had special focus on a sound conditions in both January/February moved. At Nørrebro station, large induction process, including commu- and November/December. tubes were pressed under the existing nication of the unique experience and expertise that Metroselskabet has built up over many years spent on the estab- lishment and operation of rail-borne public transport. I wish you pleasant reading. Henning Christophersen Chairman of the Board of Directors Henrik Plougmann Olsen Managing Director Annual Report 2010 METROSELSKABET 5 Financial Highlights FINANCIAL HIGHLIGHTS Passenger numbers 2005 – 2010 Million passengers 55 50 45 40 35 30 2005 2006 20072008 2009 2010 Result before write-downs and depreciation in DKK million Budgeted result before write-downs and depreciation Result before write-downs and depreciation 120 100 80 60 40 20 2007 2008 2009 2010 Operational stability 100 99 98.6 98.6 98.3 98.4 98.2 98 Objective 97.3 97 97 96 2004 2005 2006 2007 2008 2009 2010 Directors' Report Annual Report 2010 Finances 6 METROSELSKABET FINANCES RESULT AND CHANGE IN EQUITY result after financial items is a loss of tracts for the construction of Cityringen FOR THE YEAR DKK 632 million, which is DKK 245 were concluded. The conclusion of con- The profit before depreciation and million higher than in 2009. The loss tracts entails that equity will be reduced financial items for 2010 amounted is due to the write-down recognised in significantly in 2011, for the reason that to DKK 111 million, which is an im- the accounts of the Company's invest- the Company undertakes a financial provement by DKK 45 million com- ment in Cityringen, as well as write-offs obligation on signing the contracts. pared to 2009. on the existing Metro. No other events of significance to The higher profit is related to in- Finally, market value adjustment the Annual Report for 2010 have oc- creasing passenger revenue and the entails recognised revenue of DKK 358 curred after the closing of accounts. savings achieved on the conclusion of million. the new contract on the operation of In 2010 the Board of Directors, the OPERATING RESULT FOR THE METRO the Metro. The Company assesses the partnership owners and Danmarks The result for operation of the Metro result to be very satisfactory. Nationalbank approved the interest- (before depreciation) amounted to Depreciation and write-downs rate hedging of the equivalent of up to DKK 111 million, which is an increase amounted to DKK 787 million. The two thirds of the Company's maximum by DKK 45 million compared to 2009. result before financial items is hereafter expected debt. Income from the Metro totalled DKK a loss of DKK 676 million. The loss for the year of DKK 274 793 million, of which DKK 589 million Financial items comprise interest million has been deducted from equity, from the joint fare system, and DKK 204 revenues of DKK 98 million and inter- which hereafter amounts to DKK 9.1 million primarily from leasing out the est expenses of DKK 53 million. The billion. At the beginning of 2011 con- Metro and from commercial revenue. Financial Highlights DKK million 2010 2009 2008 2007 Opening balance Net turnover for the year 864 722 670 480 - Result before write-downs and depreciation 111 66 57 26 - Depreciation and write-downs -787 -596 -575 -230 - Result before financial items -676 -530 -518 -204 - Financial items 45 113 242 53 - Result before market value adjustment -632 -387 -290 -147 - Market value adjustment 358 -30 13 -4 - Result for the year -274 -417 -277 -151 - Balance sheet total 9.442 9.691 9.950 10.323 12.797 Investment in the Metro for the year 637 448 442 235 - Equity 9.139 9.413 9.830 10.100 10.251 Equity ratio 97% 97% 99% 98% 80% Annual Report 2010 Directors' Report METROSELSKABET 7 Finances Expenditure covering running costs which was an improvement by DKK tender for the major civil engineering for the Metro, contract management, 43 million from 2009. contracts for the transport system and administration, etc. this year came to the engineering works. DKK 682 million. CONSTRUCTION OF CITYRINGEN Investments totalling DKK 594 mil- Depreciation amounted to DKK The total construction budget for Cit- lion were made in Cityringen in 2010, 193 million, which corresponds to the yringen of DKK 21.3 billion is based bringing the total investment in Cit- level for 2009. The overall result was on the tenders received by the Com- yringen to date to DKK 1,454 million. therefore a loss of DKK 83 million, pany in response to the invitations to The net book value of Cityringen has been recognised in the balance sheet at DKK 0, as Cityringen is written down on an ongoing basis Operating result for the Metro to the expected recoverable value of 2010 2009 the system, taking due account of the planned construction investments. Fare payments 589 522 Metro operating revenue 190 135 FINANCING Other operating income 14 12 Total income 793 669 At the end of 2010, Metroselskabet Payment for operations -589 -522 had financial reserves totalling DKK Contract management, etc. -30 -26 1.4 billion. The Company has made Other expenses -34 -30 fixed-term deposits with banks and Administration costs -29 -26 purchased bonds. All investments Total expenses -682 -604 have been made in Danish kroner or Result before depreciation 111 66 Depreciation -193 -192 euro. The Company achieved an over- Total result -83 -126 all effective yield on its investments of 0.9 per cent (3.7 per cent in 2009). Net profit ratio before depreciation 14 % 10% In 2010 Metroselskabet concluded agreements (swaps) to hedge the in- Note: Fare payments are based on average passenger revenue per new passenger of DKK 11.22 in 2010, calcu- lated on the basis of the Ministry of Transport's Order on the distribution of ticket revenue in Greater Copenhagen. terest rates on up to two thirds of the Company's future interest expenses. The agreements concluded ensure the Company a fixed low nominal interest Investment budget for Cityringen rate on a debt of up to DKK 13 billion, when the Company's debt is expected DKK million Investments in 2010 Investments to peak. The Company's swap agree- as of 31 Dec 2010 Total budget ments are recognised under financial Cityringen 594 1.454 21.323 fixed assets at a total positive market value of DKK 304 million. Annual Report 2010 Directors' Report METROSELSKABET 9 Company Management COMPANY MANAGEMENT COMPANY BACKGROUND as one single entity, even though it is of Directors shall present a business The object of Metroselskabet is, provided by different operators. This strategy to the Company's owners as a among other things, cf. the Act on is to be achieved by the parties coor- minimum every fourth year.