Transport for London quarterly performance report Quarter 4 2017/18 About Transport for London (TfL) Contents Part of the Greater London Authority We are moving ahead with many of family led by Mayor of London Sadiq London’s most significant infrastructure Khan, we are the integrated transport projects, using transport to unlock growth. authority responsible for delivering the We are working with partners on major Mayor’s aims for transport. projects like Crossrail 2 and the Bakerloo line extension that will deliver the new We have a key role in shaping what homes and jobs London and the UK need. 4 Introduction 27 Buses life is like in London, helping to realise We are in the final phases of completing the the Mayor’s vision for a ‘City for All Elizabeth line which, when it opens, will add 6 Business at a glance 30 Rail Londoners’. We are committed to 10 per cent to London’s rail capacity. creating a fairer, greener, healthier and more prosperous city. The Mayor’s Supporting the delivery of high-density, 8 Financial summary 35 Streets Transport Strategy sets a target for 80 mixed-use developments that are planned per cent of all journeys to be made on around active and sustainable travel will foot, by cycle or using public transport ensure that London’s growth is good 10 Financial trends 38 Other operations by 2041. To make this a reality, we growth. We also use our own land to prioritise health and the quality of provide thousands of new affordable people’s experience in everything we do. homes and our own supply chain 12 Borrowing and cash 43 Commercial development creates tens of thousands of jobs and We manage the city’s ‘red route’ strategic apprenticeships across the country. roads and, through collaboration with 14 Operational trends 46 Capital investment programme the London boroughs, can help shape We are committed to being an employer the character of all London’s streets. that is fully representative of the These are the places where Londoners community we serve, where everyone 18 Customer trends 49 Appendices travel, work, shop and socialise. can their potential. Our aim is to be a fully Making them places for people to walk, inclusive employer, valuing and celebrating 22 Underground 52 Glossary cycle and spend time will reduce car the diversity of our workforce to improve dependency and improve air quality, services for all Londoners. revitalise town centres, boost businesses and connect communities. We are constantly working to improve the city for everyone. This means freezing TfL We run most of London’s public fares so everyone can afford to use public transport services, including the transport, using data and technology to London Underground, London Buses, make services intuitive and easy to use, the Docklands Light Railway, London and doing all we can to make streets and Overground, TfL Rail, London Trams, transport services accessible to all. We London River Services, London Dial-a- reinvest every penny of our income to Ride, Victoria Coach Station, Santander continually improve transport networks Cycles and the Emirates Air Line. The for the people who use them every day. quality and accessibility of these services is fundamental to Londoners’ quality None of this would be possible without of life. By improving and expanding the support of boroughs, communities The financial information included in the report is unaudited and does not constitute public transport, we can make people’s and other partners who we work with to TfL’s statutory accounts. TfL’s last audited Statement of Accounts for the year ended lives easier and increase the appeal of improve our services. We all need to pull 31 March 2017 was published in September 2017. TfL's draft unaudited Statement of sustainable travel over private car use. together to deliver the Mayor’s Transport Accounts for the year ending 31 March 2018 was published in May 2018. Strategy; by doing so we can create a better city as London grows. Definitions of terms used in the report are included in the glossary. Transport for London quarterly performance report 3 Introduction This report is the last of the financial year 2017/18 so it includes our results for the full year as well as for the fourth quarter, which is a 16-week quarter. We continue to make good progress against our long- term objective of turning an operating deficit into a surplus. We achieved greater operating cost savings than we had budgeted and, once operating costs are adjusted for exceptional items, like-for-like costs have reduced for the second consecutive year. Passenger income has fallen £51m year-on-year, reflecting a one per cent drop in passenger numbers. The impact on passenger volumes could have been considerably worse without the Mayor’s affordable TfL fares policy. We have also taken steps to successfully slow the decline in bus ridership by implementing a series of improvements in bus journey times. On a like-for-like basis, operating costs have continued to reduce. Comparable costs are £26m lower than last year and £244m lower than 2015/16. The capital investment programme delivered key achievements this year, including the upgrade of Bond Street station, the completion of tunnelling on the Northern Line Extension and significant progress with the signalling upgrade of the Circle, District, Hammersmith & City and Metropolitan lines. Simon Kilonback Sarah Bradley Chief Finance Officer Group Financial Controller 4 Introduction Transport for London quarterly performance report 5 Business at a glance Keeping London moving, working and growing to make life in our city better How we report on our business Facts and figures* Underground 9,550 Traffic signals Buses Buses on the TfL network 6,350 operated by TfL Rail Trains on the 940 TfL network 680km Streets TfL-operated Rail and Underground routes Other 580km TfL-operated Commmercial Development highways Finances at a glance Total passenger income* Total costs* (excluding depreciation) Use of £1.5bn borrowing (15%) and cash Other Passenger £1.5bn Grants reserves income income £2.6bn (32%) £6.2bn £2.3bn £2.3bn £1.0bn £4.6bn (57%) (61%) £0.6bn (5%) £1.5bn (15%) Sources of funds 29% spent renewing £10.2bn and improving the £0.5bn £0.4bn network through (4%) one of the largest (11%) capital investment programmes 71% in Europe spent on running the network every day Total: £4.6bn Total: £10.2bn ■ Underground ■ Rail ■ Buses ■ Operating costs ■ New capital investment *Based on full year 2017/18 ■ Capital renewals ■ Crossrail ■ Net financing 6 Business at a glance Transport for London quarterly performance report 7 Financial summary Performance in the full year Operating account Cash flow summary TfL Group Full year Full year TfL Group Full year Full year (£m) 2017/18 2016/17 Variance (£m) 2017/18 2016/17 Variance Passenger income 4,643 4,694 -1% Net cost of operations (1,223) (909) 35% Other operating income 750 717 5% Depreciation and amortisation 1,114 1,087 2% Total operating income 5,393 5,411 0% Net capital account (2,176) (2,163) 1% General Grant 228 447 -49% Borrowing 620 682 -9% Business Rates Retention 854 854 0% Working capital movements 1,636 (49) -3,439% Other revenue grants 84 51 65% Decrease in cash balances (29) (1,352) Total income 6,559 6,763 -3% Operating cost (6,240) (6,172) 1% Passenger journeys analysis Net operating surplus 319 591 -46% Full year Full year Depreciation and amortisation (1,114) (1,087) 2% 2017/18 2016/17 Variance Net cost of operations before financing (795) (496) 60% Number of passenger journeys (millions) 4,011 4,052 -1% Net financing costs (428) (413) 4% Average yield per passenger journey (£) 1.16 1.16 0% Net cost of operations (1,223) (909) 35% Operating cost per journey (£) (1.56) (1.52) 3% Total cost per journey before financing (£) (1.83) (1.79) 2% Capital account TfL Group Full year Full year (£m) 2017/18 2016/17 Variance Total income is £204m lower than last Operating costs are £68m up against last year, principally as a result of lower year, but after adjusting for exceptional Capital renewals (559) (793) -30% General Grant from Government. items, like-for-like costs are down for the New capital investment (1,459) (1,093) 33% Passenger income has been affected by a second consecutive year, as we continue to Crossrail (1,530) (1,593) -4% one per cent drop in passenger numbers, deliver savings through consolidating head reflecting an overall reduction in rail office accommodation and modernising our Total capital expenditure (3,548) (3,479) 2% demand in the South East. The affordable structure and ways of working. Financed by: fares policy and measures to improve bus journey times have helped encourage Total capital expenditure is at a similar Investment grant 960 944 2% people to make more journeys using level to last year. Increased new Third-party contributions 62 33 88% buses. Without the TfL fares freeze and investment, including the purchase of Property receipts 59 15 293% the extension of the Hopper fare, the new Elizabeth line trains, offsets reduced impact on overall passenger volumes renewals as major station upgrades Crossrail funding sources 108 170 -36% would have been much worse. reach completion and we slow down our Other capital grants 183 154 19% programme of proactive capital renewals Total 1,372 1,316 4% on the road network. Net capital account (2,176) (2,163) 1% 8 Financial summary Transport for London quarterly performance report 9 Financial trends Total income Total capital expenditure (excluding Earls Court) Quarterly (£m) Five-year trend full year (£m) Quarterly (£m)