INTRO: After several years in the doldrums, French National Railways is starting to improve its financial performance. Increasing traffic during 1997 has boosted the balance sheet, and the transfer of historic debt to RFF has relieved the interest burden. Jean-Paul Masse looks at the story behind the figures

ON JANUARY 8 French National Railways’ President Louis Gallois announced that the company’s finances had started to improve, thanks to encouraging traffic figures during 1997. ’For the first time after many years, our loss will be in millions of francs’, compared to the billions of francs lost in recent years.

Is SNCF definitely on its way to better days? Although the consolidated accounts are not due to be presented to the SNCF board until April 22, the early indications are favourable. SNCF had projected a loss (after taxes) of about Fr2bn for 1997. In practice, the deficit was only Fr969m, a fraction of the Fr15·2bn loss recorded in 1996. Turnover for the year to December 31 1997 was Fr86·9bn, with a gross operating profit of Fr7bn and a net operating contribution of Fr1·5bn. Commenting on the figures, Gallois emphasised that his target was break-even: ’we must not spend more than we receive. But nobody asks us to make a profit, we are not here for that. We are a public service’.

The 1997 traffic figures were surprisingly good, and the debt problem has been partly solved through the creation of Réseau Ferré de France, which is now in charge of all railway infrastructure. Reporting directly to the Ministry of Transport, RFF has taken over the vast majority of SNCF’s historic debt.

Other reasons for the improvement are multiple. Contracts have been signed with 6 of the 22 régions, who are now responsible for specifying and funding local rail services. At present SNCF remains the sole operator. With Nord-Pas de Calais, Centre, Alsace, Rh