Eurotunnel slashes growth prospects due to sterling fall

Eurotunnel has lowered its 2016 and 2017 guidance for core profit as a result of the post-Brexit drop in the pound.

The Anglo-French rail operator carries the Eurostar high-speed trains between Paris, Brussels and London.

It lost as much as a third of its value directly after Brexit vote despite offering reassurances that it would not suffer. Eurotunnel made two-thirds of its €1.22 bn in revenue last year from the shuttle services, with Britons making up 80% of car passengers.

The company said today it was lowering its forecast for 2016 earnings before interest, tax, deprecation and amortisation, excluding MyFerryLink, by about 4.5% to €535mn.

Eurotunnel, which also shuttles trains containing passenger cars, buses and trucks, said the impact of Brexit on cross-Channel transport was uncertain.

But the company affirmed that it did not expect any significant impact on its activities in the short term.

"Despite the financial market uncertainty generated by the UK voting to leave the European Union, the group remains confident in the performance of its economic model and in its outlook," chief executive Jacques Gounon said.

The first two quarters of 2016 saw a 3% decrease in Eurostar passenger traffic due to attacks in Brussels in March and rail strikes in Belgium and France, the company said.

The company's shares have recovered some losses from Brexit lows, closing 16% below pre-Brexit levels yesterday.