Merseyrail shareholders – Serco Group and Transport UK – share dividends windfall of £28m despite fall in pre-tax profits at the Liverpool city region train operator which is seeking an extension to its franchise. Tony McDonough reports
Merseyrail shareholders have pocketed more than £70m from the Liverpool city region train operator in the past two years.
On Wednesday, Merseyrail posted its annual results for the 12 months to January 4, 2025, on Companies House. They show a 6% rise in revenues to £222.8m. Pre-tax profits fell to £31.2m from £43.9m in the previous year.
Last year’s profits were boosted by an extra £15m covering previous underpayments under its 25-year contract with Liverpool City Region Combined Authority.
It means Merseyrail’s two shareholders – Serco Group and Transport UK – share a dividends windfall of £28m for the year. Last year’s dividends were £42.4m taking the two-year total past £70m.
Merseyrail’s 25-year franchise expires in 2028 but Serco Group and Transport UK are keen to continue running the network and say they have proposed an extension to the current deal in negotiations with the Combined Authority.
On Mondays to Saturdays Merseyrail operates 613 train services each day from its 69 stations across 120km of track (10.5km underground). It runs 375 services.
An average of more than 56,000 journeys were made each weekday and more than 30m passenger journeys in the year.
Early in 2024 the new £500m 777 train fleet was introduced onto the network, paid for by the Combined Authority. There has been teething problems, particularly on the battery-operated trains serving the new Headbolt Lane station.
In January 2025 Liverpool city region was hit by snow and freezing conditions. This led to multiple delays and cancellations across the network. For several hours on January 9 there were no services on either the Northern or Wirral lines.
Despite rail bosses being aware of snow and freezing conditions in advance they failed to organise rail replacement buses leaving travellers fuming. Mr Rotheram said the chaos was “unacceptable”. A subsequent report warned it could happen again this winter.
In the annual report the company said: “Merseyrail has experienced some disruption on our network attributable to the introduction of the new fleet and the issues associated with that. This has impacted our ability to provide a full service to our customers at times.
“However reliability issues that affected performance have been improving since the initial introduction… this has been a most stable year in terms of both operational and financial performance compared to the fluctuation seen in the previous four years.”
Merseyrail also reported changing passenger habits. With more companies now adopting hybrid working it said fewer passengers are using the network to commute compared to historic trends.
August saw the introduction of the top and go system, meaning passengers no longer have to buy paper tickets. So far more than 6,000 passengers have signed up with over 53,000 journeys taken across the network using MetroCards in the first month.