Bombardier Record Losses After Metronet Collapse

Transport giant Bombardier Transportation has recorded a dramatic loss in profits for the second quarter of fiscal year 2008 due to the collapse of UK rail consortium Metronet last month.

The collapse of Metronet has resulted in a $162m investment write-off.

In a statement issued today, Bombardier says it had made strong performance before the write-off of its investment in Metronet with earnings before financing income, expense and income taxes and special items growing by $87m to reach $213m.

The group has also recorded an increase in consolidated revenues from $4bn, compared to $3.5bn last fiscal year.

Bombardier says turnkey supply contracts with Metronet for new trains, signalling, train refurbishment and fleet maintenance activities, valued at approximately $6.7bn, are "progressing well and Transportation continues to work as per contractual requirements."

Troubled London tube consortium Metronet went into public private partnership administration (PPP) last month after failing to meet costs in tube upgrades and repairs.

Reported by Ozge Ibrahim