P&O to unveil €290m annual losses
Ports and ferries group P&O will this week report annual losses of around £200m (€290.4m) after counting the cost of a radical restructuring.
The biggest single blow to the company will be a £240m (€348.5m) charge for overhauling its ferries operation, which has been hit by the ending of duty free as well as competition from low-cost airlines.
Despite a strong performance from its ports business, the one-off charges are expected to wipe out underlying profits of up to £180m (€261.3m).
The bottom-line figures for 2004 will also include a write-down on the sale of property in Germany and a further £25m (€36.3m) to cover the collapse of an agreement for Brittany Ferries to take over P&O routes between Portsmouth and Le Havre.
Most of Tuesday’s restructuring charges relate to September’s announcement that it would axe four of its 13 routes – three of the four Portsmouth crossings and one across the Irish Sea – and around 1,200 jobs.
The number of ships was reduced from 31 to 23 in moves expected to save £55m (€80m) a year.
P&O, which hopes to have the restructuring in place by the middle of this year, announced half-year losses of £25.1m (€36.4m) for the ferries business in August. In contrast the ports boosted its operating profits to £71.4m (€103.7m), from £58.4m (€84.8m) a year earlier.
It has also named Sir John Parker as its first new chairman in more than 20 years. The current head of National Grid Transco will take over from long-serving chairman Lord Sterling at the company’s annual meeting in May.
