407ETR reports $519m tolls in 2007, up 13%

407ETR in Toronto reported revenue - almost entirely toll revenue - of $519m for 2007, an increase of 13% on 2006. (based on C$=US$) That puts it up in the same league as the New York State Thruway, the Pennsylvania Turnpike, Illinois Tristate Tollway, the Sam Houston Tollway and the New Jersey Turnpike as one of the top grossing tollroads in North America.

407ETR is in its eleventh year but achieving healthy growth in traffic along with steady toll increases.

The road reported an EBIDTA (earnings before interest, depreciation, taxes and amortization) of $408m, up 16%. Depreciation and amortization were boosted 10%. Interest on capital is their huge expense at $279m, up 15%. They reported a net profit for the year of $60m up 24% on the $48m of 2006.

Traffic was up 5% to an average daily 308k trips, up from 293k/day of 2006. Traffic measured by vehicle-kilometers traveled was up slightly more - by 6%. The average trip on the 108km (67 mile) tollroad was 20km (12.5mi) in 2007 compared to 19.8km (12.4 miles).

Revenue per vehicle-km was 23c in 2007 up 7% from the 21.5c/km of 2006. (37c/mile for 2007 vs 34.6c/mile in 2006.)

The Board of Directors declared a dividend of $0.044 per common share payable on or about
January 31, 2008.

Antonio de Santiago, President and CEO is quoted: “The Company accomplished two significant milestones in 2007. We opened another 49 kilometres of new lanes , completing the addition of over 100 lane kilometres in the past two years improving highway capacity and educing traffic congestion, and we launched 407 ETR Rewards to our most valued customers.”

407ETR Rewards will extend benefits of at least $40m, the company says, over four years to approximately 100,000 car customers. It is a multi-tiered frequent user program.

407 International Inc is the sole shareholder, operator and manager of 407ETR, which extends 108 kilometres east-west, just north of Toronto. 407 International Inc is owned by a consortium comprised of Cintra Concesiones de Infraestructuras de Transporte, Macquarie Infrastructure Group and SNCLavalin. Cintra is the operator.

The road was part built and opened by an Ontario state owned corporation but was quickly privatized under a 99 year concession in a deal in which the government doubled its money. The road has been more than doubled in size by the investors.

TOLLROADSnews 2008-01-31