XN000022-1989-04-12 — Page 4

WEDNESDAY, APRIL 12, 1989

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MTRC MADE FIRST NET PROFIT IN 1988

THE MASS TRANSIT RAILWAY CORPORATION PROFIT LAST YEAR, THANKS TO THE PROFITS FROM DEVELOPMENT.

RECORDED ITS FIRST NET NON-RECURRENT PROPERTY

THE FINANCIAL SECRETARY, THE HON PIERS THE LEGISLATIVE COUNCIL TODAY (WEDNESDAY) CORPORATION'S ANNUAL REPORT 1988.

JACOBS, SAID THIS IN WHEN TABLING THE

HE SAID THE RECEIPT OF NON-RECURRENT PROPERTY DEVELOPMENT PROFITS OF $722 MILLION LED TO THE CORPORATION'S FIRST NET PROFIT OF $200 MILLION, COMPARED WITH A NET LOSS OF $78 MILLION IN 1997.

HOWEVER, MR JACOBS POINTED OUT THAT BECAUSE OF THE NON-RECURRENT NATURE OF PROPERTY DEVELOPMENT PROFITS, IT WOULD BE SOME TIME IN THE FUTURE BEFORE THE RAILWAY OPERATING REVENUE WOULD REGULARLY PRODUCE A NET PROFIT FOR THE CORPORATION.

HE SAID THAT LAST YEAR THE CORPORATION RECORDED A TOTAL REVENUE OF $2,307 MILLION - 12 PER CENT INCREASE OVER 1987 MILLION CAME FROM THE FARE REVENUE THAT REPRESENTED GROWTH.

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OF AN

MR JACOBS ELABORATED THAT THE CORPORATION'S INTEREST AND FINANCE CHARGES INCREASED TO $837 MILLION, CENT OVER THE PREVIOUS YEAR.

WHICH $2,066 11 PER CENT

PROFIT BEFORE SOME 29 PER

"I

"INTEREST AND FINANCE CHARGES OF $1,372 MILLION WERE PAID IN 1988 GIVING A LOSS OF $535 MILLION AS AGAINST $749 MILLION IN 1987, HE SAID.

DESPITE PRESSURE FROM INCREASED LABOUR COSTS AND SUBSTANTIAL INCREASES IN RAILWAY MAINTENANCE COSTS, THE CORPORATION WERE ABLE TO CONTAIN ITS COSTS TO A SEVEN PER CENT INCREASE, MR JACOBS SAID.

"I AM SATISFIED THAT THE CORPORATION'S COSTS ARE CONTAINED AND ITS REVENUE GROWTH IS SUFFICIENT TO MEET ITS OBLIGATIONS, HE ADDED.

ARRANGEMENTS HAVE WON FINANCIAL

"ITS GOOD CREDIT RATINGS AND FINANCING THE CORPORATION AN EXCELLENT REPUTATION IN INTERNATIONAL MARKET."

ON THE CORPORATION'S BURDEN OF DEBTS, THE FINANCIAL SECRETARY NOTED THAT IT REDUCED ITS INDEBTEDNESS BY FOUR PER CENT TO A TOTAL DEBT OF $17,434 MILLION AT THE END OF 1988.

"FOLLOWING THE EXECUTIVE COUNCIL'S

AGREEMENT IN APRIL 1988, THE GOVERNMENT PAID A FURTHER $1,000 MILLION IN RESPECT OF THE CORPORATION'S PARTLY PAID SHARES IN ACCORDANCE WITH THE FINANCE COMMITTEE'S APPROVAL. HE ADDED.

"THERE REMAINS