407ETR traffic level, toll revenue up 5.3% in 2008 to $437m, Dec Q down

407ETR the privately operated Toronto Ontario tollroad reports 2008 traffic about level with 2007 and revenue up 5.3% to $437m (C$547m @C$=80c). The December quarter saw traffic down - 3.4% as measured by vehicle-km traveled vs 2007Q4, 1.5% down by total trips, 1.9% down by average workday trips.

Whole year trips (2008/2007) were up by 1.2%, average weekday trips by 1.0%, but the best measure, vehicle kilometers traveled showed level pegging - less than a tenth of a percent change.

Tolls collected for the whole year of 2008 were up 5.3% (C$546.5m vs C$518.9m) but the December quarter suggests a downturn toward the end of the year as the Ontario economy follows dismal US trends, albeit lagged and not as severe, yet.

2008Q4 saw toll revenues of C$133.5m vs 2007Q4 C$135.8m  - a drop of 1.7%.

Earnings before income taxes were C$85.1m in 2008 vs C$60.3m in 2007. Income tax recovery enabled the company to substantially increase their net income to C$119m in 2008.

In a statement the group 407 International said: "Earnings before interest, taxes, depreciation and amortization (“EBITDA”) totalled $414.3 million for 2008, after an adjustment to the Company’s provision for doubtful accounts on historical balances ($24.6 million), compared to $407.6 million for 2007. Net income for 2008 increased to $119.0 million compared to $60.3 million in 2007 as the Company recorded a future tax recovery and lower non-cash inflation-related interest expense, partially offset by an unfavourable non-cash fair value adjustment on long-term investments." (all C$s=80c)

The board of directors declared a dividend of C$0.061/ share.

BACKGROUND: 407 International is the operator of 407ETR tollroad which runs 108km (67 miles) across the northern portion of the greater Toronto metro area (5.7m pop).

The approx ten year old pike:

- ranges in width between 4 and 10 travel lanes,

- has around 40 interchanges and

- uses a Raytheon all-electronic highway speed tolling setup, a combination of transponder accounts and tolling by video imaging of license plates and motor registry lookup for billing by mail.

920k transponders (active ASTMv6 at 915MHz) were on issue at end-2008.

It is among the top three or four highest grossing and busiest tollroads in North America.

407 International has a 99 year concession and is owned by Cintra Concesiones de Infraestructuras de Transporte based in Madrid Spain, Macquarie Infrastructure Group based in Sydney Australia and SNC-Lavalin of Toronto in approximately 50/30/20 ratios.

Operations are by Cintra.

TOLLROADSnews 2009-02-10