Debt light in sight at Eurotunnel

CHANNEL Tunnel operator Eurotunnel is on target to cover its huge annual debt repayments from next year, the group declared as it confirmed a revamp of its loans.

The heavily loss-making group said a programme of debt-juggling begun in March had been finalised, supported by last week's closure of a £740m, 25-year fixed rate bond issue. Net debt would fall by £446m and interest payments would drop by £35m this year.

Last year, interest payments topped £330m. But Eurotunnel's plan to cover that from operating profits was thwarted by Britain-bound asylum seekers disrupting services, and by a collapse in revenue from telecoms operators using the tunnel to lay cable.

Finance director Roger Burge said the company would now hit its debt target in 2003. The rearranged debt schedules should cut interest charges by another £20m next year and £30m a year from 2006.