*Photograph: Brian Arthur
OPERATING PROFITS at the consortium which operates the €800m Limerick tolled tunnel last year increased by ten percent to €11.96m after a hike in toll charges.
New accounts show that DirectRoute (Limerick) Ltd last year enjoyed the operating profit surge as revenues went up by ten percent from €27.19m to €29.84m.
The route forms part of the main transport route in the Midwest linking Limerick to Galway and traverses Clare bypassing the likes of Ennis and Newmarket-on-Fergus.
Toll charges for cars increased by twenty percent at the start of 2024 to €2.30 linked in inflation which led to the higher toll revenues for 2024.
The toll hike followed toll charges for cars increasing by 10c to €2.10 in inflation linked toll increases on July 1st 2023.
A breakdown of revenues show that toll income increased by thirteen percent from €21.2m to €23.9m.
The revenues for the Limerick tunnel firm also included traffic guarantee payments from Transport Infrastructure Ireland (TII) which declined from €5.2m to €5.02m last year.
The traffic guarantee payments are made when daily traffic volumes don’t exceed a particular threshold and they were put in place at the outset of the project in order to attract consortia to bid to build the scheme.
The directors state that “revenue risk is reduced by the Traffic Guarantee mechanism which guarantees revenue to a certain threshold”.
The firm also benefited from operating payments of €905,292.
The company recorded a pre-tax loss of €11.45m after paying out €23.54m in loan interest payments.
The directors state that “The largest expense remains to be interest repayments on the project funding mainly in the form of bank loans and bonds. The contract is currently in year 18 of its term and will expire in 2041”.
On the company’s ongoing concern status the directors state that in accordance with the Common Terms Agreement governing the funding for the project, and based on current performance, the company is not making repayments on the mezzanine and shareholder loans that were provided to fund the overall project.
The directors acknowledge that the current forecasts indicate that based on the waterfall of payments over the life of the project, that while all third-party funding is forecast to be repaid, there may not be sufficient resources to repay the shareholder loans in full at the end of the project and the directors are satisfied that the shareholders are aware of this possibility.
The loss also takes account of non-cash depreciation of €13.5m.
Total key management compensation last year increased from €98,185 to €101,306.
The Limerick tunnel route was first opened to traffic in July 2010.
At the end of the concession period in 2041, the firm will hand back the road to the TII. The firm had accumulated losses of €127.74m at the end of last year. The company’s cash funds declined from €30m to €5.5m.
