Network Rail is on track as its debt soars

RAIL infrastructure group Network Rail said its debts have jumped, though it remains on track with cost-savings and improvement works.

Its debt rose to a whopping £25.7bn in the period, which the group said was “at an expected level” due to capital expenditure and the rising value of its inflation-linked bonds.

Around £1.25bn of Network Rail’s debts are bank loans and overdrafts.

Capital expenditure soared by almost a fifth to top £2bn, as the group forged ahead with Thameslink upgrades at Farringdon and Blackfriars, as well as Crossrail work.

But Network Rail said that its running costs are, in real terms, more than £300m lower than in 2008-09, when the Office of Rail Regulation asked it to cut costs by 22 per cent between 2009 and 2014.

The group also booked a gain of £1.1bn for the rise in value of the railway network.

The growing number of copper cable thefts on the rail network are impeding its performance, with 92.8 per cent of trains running on time compared with 93.5 per cent last year.

Network Rail’s operating profit rose 8.6 per cent to £1.23bn in the six months to the end of September – but profits after tax halved to £136m.