After strong growth in 2015 (+12.2%), Keolis continued to deliver solid results in 2016, consolidating its core business and intensifying development in emerging mobility solutions. The Group was able to anticipate issues resulting from a rapidly evolving industry. International growth continued, increasing from 21% to 43% of the Group’s business in 10 years. In 2016, Keolis secured new contracts in the United Kingdom, Australia, Germany, the Netherlands and Sweden, which will commence in 2017 and 2018. In France, a high concentration of calls for tenders allowed Keolis to consolidate its portfolio and reinforce its position in the parking market, thanks to a year of record-breaking growth from its EFFIA subsidiary.
2016 results: Keolis strengthens its growth
Revenue reached €5.1 billion in 2016, a €72 million increase on 2015, representing +1.4% in growth.
After several years of strong growth, revenue showed moderate progression. This is in part due to the appreciation of the euro, which closed the currency gap and the gain of contracts (€450 million per year), the effects of which will carry over to 2017 and 2018. Revenue was driven by external growth activities from 2015 and 2016.
The group's profitability (EBITDA) rose in comparison to the previous year, reaching €313 million (+5.5%). This reflects the effective integration of acquisitions, in line with business plans established during investment decision-making.
The Group's financial structure remains solid, with a net debt limited to €870 million, allowing for a leverage ratio of 2.3x at the end of 2016, well under the limits estimated in banking documentation.
The Group's net income share was stable at €45 million.
A successful year internationally
Keolis confirms its lead in multimodal expertise
In the United Kingdom, Keolis won the contract for the operation and maintenance of the Manchester tram network. With seven lines transporting 37 million passengers every year, the Manchester tram network is the biggest in the United Kingdom. KeolisAmey – the joint venture owned by Keolis (60%) and Amey (40%) – will start running this network from 15 July 2017. KeolisAmey will manage a fleet of 120 trams, and oversee the extension project for the Trafford Park line, scheduled for completion by 2021.
With this contract, Keolis, the world's largest provider of tramway transport, further increases its lead in the sector. The Group also continues to develop across different modes of transport in the UK, having already secured three railway franchises, the Nottingham tram network and London's driverless automated metro (DLR).
In Newcastle, Australia, the Group won the country's first multimodal contract. Undergoing a full urban renewal, the city’s administration chose a private operator for their bus, ferry and future tram networks. This 12-year contract is a national first and represents a chance for Keolis to display its expertise in multimodality, and reinforce its Australian presence.
In Germany last July, Keolis secured the operations contract for the Rhine-Ruhr S-Bahn train network in Rhineland-Westphalia, the most populous region in Germany with 11 million inhabitants. With this acquisition, which follows on from the 2015 regional train contract in Teutoburg Forest, Keolis doubled its number of train-km in Germany, from 11 to 22 million.
Keolis Deutschland, a partner of Thalys since December 2016, is the only private operator in Germany to simultaneously run high-speed, regional and suburban train services.
Keolis also continues to grow in the Netherlands, winning two bus contracts:
- The regional lines around the city of Utrecht (over 200 buses), have been run by Keolis since 11 December 2016.
- The contract to operate 110 buses in Almere, in the suburbs of Amsterdam, will begin in December 2017.
In addition, the Bergen tram extension in Norway and the gain of multiple bus contracts in Sweden allowed Keolis to consolidate its presence in Scandinavia.
A new direction for Boston
In Boston, the situation showed clear improvement. After a difficult winter in 2015 marked by a succession of snowstorms, punctuality has now returned to a high standard with an average of 93% in 2016, the best performance in 13 years. This return to operational efficiency was accompanied by a significant increase in customer satisfaction over the course of the year.
Positive commercial results in France
An intense year for call to tenders
2016 saw high numbers of call for tenders in France. The contracts won or renewed by the Group generated annual revenue of €800 million, representing 30% of Keolis' overall revenue in France.
Keolis was able to secure multiple renewals for iconic networks, starting with Lyon on 7 October 2016.
Connecting 73 districts and catchment areas, and transporting 1.7 million passengers every day with an average of 350 journeys per person per year, the TCL network holds the national record for public transport use. Keolis' number one contract in terms of revenue and passenger flow, Lyon's transport network is a true showcase of the Group's multimodal expertise. Keolis operates the metro, trams, funicular trains, buses, trolleybuses and, as of September 2016, the autonomous electric shuttle buses in the region.
The new six-year contract began on 1 January 2017. It is set to generate combined revenue of €2.2 billion.
On 22 December 2016, the Group won the first tender of public services in Dijon, covering all mobility services in the region. For the first time in France, public transport, bike-sharing services, car parks and parking control are all combined under the one "Comprehensive Mobility" contract. This 10-year contract is expected to generate €435 million in revenue and allow the Group to reassert its position as an expert in everyday mobility solutions.
Keolis has also renewed contracts for urban transport networks in Laval, Narbonne and Chantilly. Suburban transport contracts totalling €90 million were renewed, as well as contracts for specialised forms of transport, such as transport for passengers with reduced mobility with PAM94 in Paris and Optibus in Lyon.
Furthermore, the Group renewed its contract for the operation of Penn Ar Bed ferries, connecting the islands of Molène, Ouessant and Sein, in Brittany. Keolis reinforced its presence in Brittany and confirmed its ability to operate all modes of transport, including maritime services.
Finally, the end of 2016 saw the renewal of over 20 bus contracts with STIF in the Greater Paris region, bringing an additional €180 million in combined annual revenue, and the winning of two new major contracts:
- The Chronoplus network of Côte Basque Adour (Bayonne-Anglet-Biarritz) will be operated by Keolis from 1 April 2017
- Keolis will commence a six-year contract for the operation of FILIVAL PAM94, a transport service for people with reduced mobility in Val-de-Marne, from 6 March 2017.
Strong growth in ticketing revenue
Despite the difficult economic climate, Keolis has achieved performance standards that far exceed the industry average: A +3.9% increase in ticketing revenue of urban networks and a +1.6% increase in patronage.
This success reflects the Group's effective approach to increasing market share, through loyalty initiatives and fare evasion policies.
Acquisitions in suburban transport
After having acquired the bus company Fouache in October 2015, Keolis continued to strengthen its position in the suburban market with the successful integration of the Daniel Meyer bus company (Esonne, revenue: €43 million) on 5 January 2016. The Group also bought the bus company Jacquemard in Normandy last summer.
Enriching the multimodal offer
Consistent with its diversification strategy, Keolis continued to expand into new mobility solutions. The Group invested in some promising new businesses including LeCab, a leading name in private driver services, and the autonomous shuttle company Navya. These strategic alliances have led to the release of new mobility services such as Navly, the world's first autonomous shuttle service to be integrated into a public transport network, in Lyon in September 2016.
In November 2016, the Group launched France's first urban cable car in Brest. This new mode of transport is already used by an average of 2,600 passengers every day, a patronage level 45% higher than originally forecast.
Record growth for EFFIA, the number two provider of parking facilities in France
In 2016, the Group's parking subsidiary won 19 new contracts. With an extra 30,000 parking spaces, EFFIA now manages a total of 175,000 spaces.
EFFIA continued its external growth strategy by buying a 33% share in SAEMES, a partially government-owned Parisian parking company that is the second biggest parking provider in the Greater Paris region.
EFFIA also signed a strategic partnership with OnePark, a parking space online reservation platform, which is playing a major role in the digitisation of the parking market. It also purchased a leading share in L20, a carwash company that uses recycled water.
2017 will be marked by multiple contract launches, two of which are especially important: the elevated automated metro in Hyderabad scheduled to open in the third quarter and the first driverless automated metro line in Shanghai in December.
The summer of 2017 will be a particularly busy period for the Group, with the start of operations for the Manchester tram network in the United Kingdom; the start of the contract in Newcastle, Australia, in July; and the launch of Denmark's first tramway network in Aarhus (contract won in 2015).
Lastly, in December, Keolis will begin operations of the regional train network in Teutoburger-Wald-Netz, Germany (won in 2015), regional trains in the Overrijsel province of the Netherlands (2.7 million train-km annually) and the Almere bus network in the suburbs of Amsterdam.
A significant number of calls for tenders are expected in 2017, with over €770 million worth of contracts up for renewal. This is significant for Keolis as five of its largest urban network contracts are being renewed: Lille, Rennes, Caen, Amiens and Lorient.
The Greater Paris region, which has the most potential for long-term development, will present a particularly big challenge for Keolis, particularly in relation to the launch of the T11 Express tram-train. The Group will position itself to respond to future call for tenders such as for the T9 and T10 tramways and the CDG Express, in addition to its involvement in construction sites for the Grand Paris project.
Following the strengthening of the Group's position in the suburban market, Keolis will adapt to the introduction of the NOTRe laws in France in 2017, which transfer public transport authority from a departmental level to a regional level. The Group will also continue to seek new opportunities for external growth.
In the parking sector, EFFIA will continue its organic growth, having responded to around 40 call for tenders in 2016.
New mobility solutions
With the launch of PLUS, the first shared private driver service on 31 January 2017, in collaboration with LeCab, global leader in the development of shared solutions (VTC and VIA), Keolis is accelerating its development in new forms of mobility.
The Keolis Group combines traditional modes of public transport with new solutions to meet an ever diverse range of needs.