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Last Updated: Friday, 6 October 2006, 14:52 GMT 15:52 UK
Ferry firm reports losses of 2m
CalMac ferry
Rising fuel costs and pension contributions play a part in losses
Ferry operator Caledonian MacBrayne has made an operating loss of 2m in the past year, according to its newly-published annual report.

Fuel costs, traffic and berthing dues and the company's pension deficit all contributed to the figures.

The Stornoway to Ullapool route was identified as the biggest loss-maker for the state-owned company.

Retiring chairman Dr Harold Mills insisted CalMac was in "good shape" to face the upcoming tender process.

CalMac made a loss of 33m, but that was before the injection of a Scottish Executive deficit grant of 31m.

Fuel costs increased from under 6m to 9.5m despite a special scheme making fuel available to the company at prearranged rates.

Route losses

CalMac said it had maintained the number of passengers it carried at more than five million, while it carried more than a million cars.

The company carried 14,000 coaches - an increase of 1,000 on the previous year.

For the first time the report has a breakdown of route-by-route losses, with Stornoway to Ullapool losing more than 4m and the Lochboisdale more than 3m.

With the European ordered tendering process to come, the figures may seem depressing.

However, Dr Mills said the company was in good shape for the future.

CalMac is poised to tender for its own routes

CalMac is to be split into three new companies from October. One of the companies is registered in Guernsey in the Channel Isles, resulting in substantial tax savings.

The bulk of administrative staff will remain based at Gourock in Inverclyde, while ownership of the ferries will be transferred to a third company.

The RMT union said it had been reassured by guarantees that staff's pay and conditions would not be affected.

CalMac management said this could help it to become more competitive during the tendering process for its own routes.

The winner of the first tender, for the Gourock to Dunoon route, is expected to be announced at the end of October.

CalMac and Western Ferries have both tendered for the contract.

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