NS suffers €185 million loss despite gov't support
Dutch rail company NS suffered a loss of 185 million euros in the first half of this year. Without support from the government, that loss would have been over a billion euros, NS said in the presentation of its half-year figures on Friday. More support will be needed for the public transport sector to survive, the company said.
The main culprit behind the losses is the coronavirus pandemic. With travel restrictions and people instructed to work from home, NS saw its passenger numbers plummet. Not only in the Netherlands, but also for subsidiaries in the United Kingdom and Germany. This naturally resulted in a major loss of income.
In the Netherlands, NS received 351 million euros in government support, plus another 9 million euros from the NOW regulation so that it could keep paying its employees. The UK government compensated NS 100 percent of its turnover lost due to the pandemic. Without this support, NS' losses would have amounted to over a billion euros in the first half of this year, the company said.
All in all, NS suffered an operational loss of 52 million euros. The fact that the net loss is so much higher has to do with accounting reasons - NS has to write off 107 million euros of the so-called "deferred tax assets", money the company expected to get back from the tax office, but won't anymore because of unexpected losses.
In the coming period, NS will focus on increasing traveler numbers again "in a way that is logical and responsible in corona times," CEO Roger van Boxel said. "After the summer, there will be new subscriptions that are attractive for commuters who are working from home more often due to corona." Staggered travel is important for travelers to be able to maintain social distancing as much as possible, Van Boxtel said. NS is therefore in talks with education institutions and large corporate clients about class and office hours, to see if rush hour can be spread out more.
The company expects to be running at a loss for a considerable time yet. "Due to different travel behavior and economic contraction, it is not expected that passenger numbers will return to the level of 2019 until after 2024, wile fixed costs will continue as usual. The Dutch public transport sector has to adapt, but will not survive without further support," Van Boxtel said.