Keolis Group turnover increased by 10% following strong growth, including a new contract in the UK with Transport for Wales.
Key Growth Figures
- Group turnover increased by 10% to €5.93 Billion.
- Profitability (recurring EBITDA) rose by 15% in 2018, to €392 Million (2017: €342 Million).
- Operating margin is 6.6%.
The Keolis Group recorded an exceptional year of growth and development in 2018, with major tenders won and increases in turnover (+10%) and EBITDA (+15%).
This growth is due to significant success, both in France and internationally, as the Group continues to demonstrate its ability to adapt to changes in the transport sector with innovative, shared, sustainable, connected and autonomous mobility solutions.
Group turnover reached €5.93 Bn in 2018, a €535 M increase on 2017 (+10%).
Revenues grew organically by +10.4%, excluding the effects of foreign exchange and changes in scope, and by +12% at constant exchange rates. This large increase is due to the strong results recorded by all the businesses of the Keolis Group, including the launch of a major 15-year contract in Wales, as well as other contracts across Europe (Netherlands, Germany, UK) and Australia.
The Group’s profitability (recurring EBITDA) also increased significantly compared to the previous year (+15%), reaching €392 M, mainly due to organic growth. This translates into a 2018 operating margin of 6.6% (compared with 6.3% in 2017).
Jean-Pierre Farandou, Executive Chairman of the Keolis Group, said:
“Keolis continues its development, with double-digit growth and a significant increase in operating margins.
“We are investing to consolidate our status as a world player in the shared mobility market. Our performance provides us with the means to develop and to continue our transformation in an extremely competitive environment”
The Group’s financial structure has been strengthened, with net debt at €982 M, lower than the previous year (€1,011 M). The net debt/EBITDA ratio is at 2.2x, well below the limits set in the Group’s covenant.
The recurring net profit Group share is €79 M, 5.6% less than in 2017; this is due to the effects of taxes, notably related to the CICE (tax credit for competitiveness and employment) and CVAE (contribution on added value).
The net profit Group share is €30.9 M in 2018, below 2017 (€50.9 M), explained by various tax impacts and non-recurring items that have no impact on the Group’s cash flow.
Dynamic International Activity & Growth
With growth of 13%, international revenue now represents 49% of the Keolis Group’s “Public Transport” turnover. This growth is supported by new and renewed contracts and successful launches in the sector of mass transit networks, as well as the creation of innovative micro-transit offers.
Keolis Consolidates its expertise in the Rail Sector
In May 2018, KeolisAmey, the Keolis Group’s UK subsidiary, won the entire national rail network of Transport for Wales. The 15-year contract, with a cumulative revenue of €6 billion, is Keolis’s largest ever win and its first rail contract in the UK as a majority partner.
The contract came into effect in October 2018 and includes the operation, maintenance and renovation of the network, which comprises 1,623km of track, 128 trains, 247 stations and three depots.
2018 also saw the Keolis Group’s rail transport expertise bringing an improved operational performance to the Boston suburban train network as well as positive financial results for the first time since Keolis began operating the network. Based on higher levels of punctuality and reliability, this performance improvement has generated a 22% increase in passenger numbers since 2014.
With Growth, Keolis confirms its status as Global Leader in Trams …
Illustrating the Keolis Group’s capacity to propose mass transit solutions for all countries, Shanghai Keolis, the joint-venture formed by Shanghai Shentong Metro Group Co. Ltd. (51%) and Keolis (49%), began operating the first section of the Songjiang tram line, a district in the south-west of the city. Inaugurated in December 2018, this is the first tram operated by the Keolis Group in China.
In Northern Europe, Keolis was once again selected to operate the Bergen tram in Norway for another eight years. Patronage doubled between 2010 and 2018, confirming its success with passengers.
In Denmark, the Keolis Group was chosen by the public transport authority of Odense to operate and maintain its future tram network, which is scheduled to launch in 2021. The fifteen-year contract will generate a cumulative revenue of approximately €230 M. This is the country’s second tram network, after Aarhus, where Keolis extended the tram line from 12 to 32km in August 2018.
In Australia, 2018 also saw the start of the new Melbourne tram contract, following its renewal for seven years in 2017. Operated by the Keolis Group’s Australian subsidiary Keolis Downer since 2009, this is the world’s largest network. The project notably includes the overhaul of more than 85% of the fleet over the next four years, and track modernisation work.
At the beginning of the year, Keolis Downer, which already operates buses, real-time on-demand transport and ferries in Newcastle, successfully launched the city’s new tram service. This multimodal transport network is the first to be entrusted to a private operator in Australia.
… and leader in automated metros
2018 was also the year of preparation and launch of automated metro lines in both Asia and the Middle East.
At the end of 2017, in Qatar, Keolis won a €3 billion contract as part of the Keolis, RATP Dev and Hamad Group consortium to operate and maintain the Doha automated metro and Lusail tram. Almost 1,000 employees have been recruited and trained, with a final objective of 3,000 employees. The network will be deployed in phases between now and the Football World Cup in 2022 and will be able to transport 650,000 passengers per day. It will be opened to the public imminently.
In China, the Keolis Group continues to develop. Shanghai Keolis began to operate the Pujiang driverless metro line in March 2018. It is Shanghai’s first driverless automated metro line, covering 6.7km and connecting six overground stations to optimise service to the Pujiang district in the south of the city.
In 2019, Keolis will also start operating the metro for Terminal 3 of Pudong airport.
The project aims to support the rapid development of the airport, which is expected to receive some 80 million annual passengers over the next few years compared with 60 million today. The 20-year contract includes several phases, the first of which will begin this summer.
In India, two new sections of the Hyderabad automated metro were opened, and the network is now the second-largest in the country in terms of size. With these extensions, the metro now links the east to the west of the city, serving the major business district, HITEC City, which attracts many new companies and residents to Hyderabad every year. When the 67km line is completed this year, it will carry over a million passengers every day
Last year, the Keolis Group continued its external growth strategy by acquiring four companies from Belgian firm, Open Tours Group. Specialising in airport transport, they will enable Keolis Belgium to expand its public transport activities, which also include school transport and tourist transport services.
A very good year for sales in France
2018 was characterised by multiple invitations to tender and punctuated with commercial successes in an increasingly competitive market. Both defensive and offensive contract awards in 2018 demonstrate the Group’s capacity to maintain and build strong relationships with public transport authorities.
In 2018, Keolis consolidated its leadership on the open French market and confirmed its ambition to be the number one partner of public authorities, assisting them in their own transformational challenges.
Excellent growth trends in passenger revenues
In 2018, Keolis recorded a strong increase of 5.3% in commercial revenues within its 15 largest urban networks, which account for more than 95% of patronage. This is coupled with a +3.2% increase in the number of passengers.
The income from these networks, which totalled €602 M, thus passing the €600 M mark for the first time in Keolis’s history, testifies to the expertise of the Keolis Group in designing attractive networks, sales actions to win and retain customers, and fare evasion measures.
Major New Contracts
Keolis won three new contracts, which came into effect on 1 January 2019:
- Nancy: A six-year contract to operate its public transport network will generate a cumulative revenue of €346.8 M.
- Chambéry: A six-year contract, with cumulative revenues of €138 M, includes the management and operation of the public transport network, with a targeted 14% increase in passenger numbers (15 million passengers per year vs 13 million at present).
- Bourg-en-Bresse: A four-year contract for all public transport across the regions 75 communes, with a cumulative revenue of €37.5 M.
In Île-de-France, the French State designated the “Hello Paris” group, comprising Keolis and RATP Dev, to operate the CDG Express, the direct rail link between Paris Gare de l‘Est station and Paris-Charles de Gaulle airport, in preparation for the Paris Olympic Games in 2024. The contract, which is expected to be signed in the very near future, includes a five-year pre-operational period (2019–2023), followed by a fifteen-year operational phase (2024–2038).
Parking: An historic year for EFFIA
In 2018, the Keolis Group’s EFFIA subsidiary won 25 contracts, representing €28 M in annual turnover including €19 M of new contracts. These successes are all the more important given that EFFIA won almost all the major tender contracts, and notably all the barrier parking contracts, for Limoges, Le Havre and Grenoble.
In total, as of 1 January 2019, EFFIA manages 240,000 parking spaces, four times more than when it was acquired by Keolis in 2010.
Keolis Santé: continued development via external growth
Following on from the alliance formed at the end of 2017 between Keolis Santé and Jussieu Secours, which led to the creation of France’s first medical transport network, Keolis Santé acquired and integrated another 12 firms in 2018. On the strength of these acquisitions, the Jussieu Secours network now has 4,200 professional staff across France, and a fleet of 2,600 vehicles, representing a revenue of €210 M.
Keolis Accelerates its transformation through innovation
In sustainable mobility
As a supporter of the energy transition, Keolis makes commitments to both public transport authorities and passengers to promote more sustainable means of transport.
In 2018, Keolis prepared the launches of various projects with dedicated transport corridors: the 100% electric bus rapid transit (BRT) services in Amiens and Bayonne-Biarritz-Anglet, the hydrogen BRT service in Pau* and the new steel-wheeled tram in Caen, which are scheduled for the coming months.
Thanks to these launches, in 2019, the Group will become the operator responsible for the largest number of 100% electric bus networks in France.
In December 2018, Keolis Canada became the largest 100% electric school bus operator in North America.
In the USA, the Group will soon be in charge of the second-largest electric fleet on the East Coast. Operating buses in Greensboro, North Carolina, since January 2019, Keolis launched the state’s first all-electric bus line in February 2019. The entire fleet (43 buses) is due to be converted to electric power.
*(In Pau, Keolis provides technical assistance)
Real-time shared mobility
Keolis hopes to use the development of artificial intelligence to enhance its expertise in real-time, on-demand transport.
This offer, which guarantees flexibility for passengers, encourages the use of public transport via an efficient multi-modal structure, helping to reduce urban congestion by sharing vehicles.
In collaboration with Via (world leader in real-time shared mobility solutions), the Keolis Group launched a number of dynamic on-demand transport projects in 2018, including KE’OP in Bordeaux, France.
In 2019, this transport offer will be deployed in Nancy and Tours.
On the international front, Keolis and its partner launched dynamic on-demand transport offers in Sydney and Newcastle in Australia, and in Orange County, California, USA.
Keolis also continued to launch real-time, on-demand transport offers in the Paris region with Filéo, the largest on-demand transport service in Europe, which includes services to Paris Charles de Gaulle airport, and Orléans.
In digital mobility
To offer a simplified, connected passenger experience, Keolis is constantly innovating and creating new digital mobility services.
In Dijon, Keolis launched the first open payment solution deployed in a French transport network, enabling transport ticket validation using a contactless credit card. The very rapid
uptake and success of this innovation (650,000 validations and 83,000 new users in one year) encouraged Keolis and Dijon Métropole to expand the service, initially used only on the tram, to the bus network in autumn 2018.
In autonomous mobility
Keolis, a pioneer in new mobility solutions, continued its autonomous shuttle strategy in partnership with the manufacturer Navya.
In 2018, nine new trials were launched in France (on the university campuses in Lille and Rennes, in Nevers and in Paris Charles de Gaulle airport) and abroad (at Flinders University and in Victoria state in Australia; in Candiac, Canada, on public roads; and in Han-sur-Lesse and Braine l’Alleud near Waterloo in Belgium).
The Keolis Group will continue these trials in 2019, notably serving the OL stadium in Lyon, and in Australia, in Sydney and Newcastle.
Since their launch in 2016, the shuttle services operated by Keolis on more than 30 sites have covered more than 60,000km and transported more than 140,000 passengers.
Since 2016, the Keolis Group has been developing a carpooling service to offer passengers a dynamic solution that operates alongside the other transport modes.
To develop its offer, Keolis has formed a partnership with Instant System. Currently available in Bordeaux, Dijon, Rennes and Lille, more than 10,000 people have signed up for this service.
This year, the offer will be launched for the Bourg-en-Bresse, Le Mans, Besançon and Chambéry networks.
Significant growth in turnover and profitability confirms the pertinence of the Keolis Group’s strategy. Profitable growth secures Keolis Group’s transformation towards mobility solutions of the future, which will be shared, sustainable, connected and automated.
In 2018, the Keolis Group balanced its activities between France and the international market, both in terms of turnover (51% vs 49%) and its 3.3 billion annual passengers.
Symbolising the dynamism of the Keolis Group, the headcount at Keolis increased by 3%, totalling 65,000 employees (37,000 in France and 28,000 internationally) in 16 countries at the end of 2018. In parallel, 2018 saw the Group recruit 4,460 employees in France and 3,907 internationally, excluding acquisitions.