•    Orders rise by 109% at constant exchange rates (CER) as rail industry continues to demonstrate strong fundamentals
•    Operating profit soars 32% at CER to £134 million
•    Operating margin improves to 21.1%
An impressive performance from railway control and communication solutions provider Invensys Rail helped Invensys plc report a robust performance in the financial year ended 31 March 2009 despite the economic downturn. Overall Invensys plc made operating profits of £244 million on revenue of £2,284 million, with underlying earnings per share1 of 14.1p.
Invensys Rail – which also owns the Westinghouse Rail Systems and Dimetronic brands – saw operating profit soar by 32% to £134 million, while orders rose from £429 million in 2007/08 to £968 million – a 109% rise at CER.
During the year Invensys Rail won major contracts both within and outside of its core markets. In the UK, it won an important contract from Network Rail to undertake signalling enabling works at Reading Station, which represents the first state of the £425 million Reading Redevelopment Project.  It has also recently won a contract from Crossrail Ltd to evaluate signalling and control solutions for the Crossrail project.

Outside the UK, Invensys Rail’s Spanish operation Dimetronic continued to build on its success, winning £155 million of contracts for the signalling of the Madrid-Valencia high-speed line, and receiving a letter of award for a £44 million contract on the Barcelona-Figueras high-speed line.

Singapore’s Land Transit Authority awarded Invensys Rail a £123 million contract for the country’s new Downtown Line, while, in New Zealand, Westinghouse Rail Systems Australia is to install European Rail Traffic Management System (ERTMS) signalling in Auckland – the first project of its type in Australasia. Another major ERTMS contract is for the installation of the pan-European signalling system on the Ankara–Konya high-speed line in Turkey. In North America, Invensys Rail’s recently-acquired operation, Quantum Engineering, is set to benefit from investment in Positive Train Control signalling systems.

Despite the recession, Invensys Rail believes the global rail market remains strong, helped by growing recognition of rail’s environmental and economic benefits over other modes of transport for both passengers and freight, and also by government stimulus packages investing in rail.

Invensys Rail Chief Executive, James Drummond, said: “We are extremely pleased with Invensys Rail’s performance in all of our markets. The fundamentals of the rail market are strong, and we believe our range of advanced and scalable signalling and communication solutions positions us well to benefit from initiatives to enhance capacity and safety on mainline and mass transit networks all around the world.”

Table: Invensys Rail financial performance
Year ended 31 March                   2009      2008    % change at CER2    % total change
Orders (£m)                                    968        429              109%                       126%
Revenue (£m)                                 636        539                 9%                         18%
Operating profit3 (£m)                    134         93                32%                         44%
Operating margin3 (%)                21.1%     17.3%        
Operating cash flow (£m)               128         93                 26%                        38%
Operating cash conversion (%)      96%      100%        

1    Calculated by reference to earnings before exceptional finance costs and income, and foreign exchange losses on financial items. Prior year earnings per share also exclude the PPP settlement credit.
2    % change is measured as the change at CER as a percentage of the 2008 adjusted base and is calculated based on underlying amounts in £’000s.
3    All references to operating profit and operating margin are arrived at before exceptional items, unless otherwise stated

IRG announced that its subsidiary Westinghouse Rail Systems Australia (WRSA) has won a A$14m turnkey signalling contract from the Australian Rail Track Corporation Ltd (ARTC).  The contract is central to an ARTC project to improve the efficiency and cost-effectiveness of rail freight services along the North-South Rail Corridor between Melbourne, Sydney and Brisbane.

A major bottleneck in the rail freight network currently exists in southern Sydney, where freight trains share existing rail lines with the Sydney metropolitan passenger services operated by RailCorp.  During morning and afternoon peak periods, freight services are not permitted to run due to passenger priority.  As a result, freight services cannot arrive or depart Sydney at the optimum times.

To alleviate this bottleneck, the ARTC began work on the Southern Sydney Freight Line (SSFL), which will provide a dedicated freight line for a distance of 36km between Macarthur and Sefton in southern Sydney.  The SSFL will provide a third track in the rail corridor specifically for freight services, allowing passenger and freight services to operate independently.

Under the contract, WRSA is to supply a turnkey signalling system, including design, supply, installation, testing and commissioning.

One of the main reasons for WRSA’s contract win was the ability to reduce the requirement for signalling technology on the project.  Managing Director Phil Ellingworth explains “ARTC’s tender specified delivery of a conventional interlocking solution using track circuits.  WRSA proposed an alternative solution using service-proven signalling elements in an innovative architecture delivering optimal value to meet ARTC’s key operational needs.”  “It was this innovative engineering solution that won WRSA the tender in the end” he added.

The ARTC has been a major client of WRSA for many years and this latest project is one in a series won in recent times.  These include: the relocation of the train control system in Victoria to Mile End in Adelaide; North Coast New South Wales level crossing upgrades; the Newport to West Footscray signalling upgrade; and upgrading the crossing loops on the Trans-Australian Railway between Port Augusta and Kalgoorlie.

IRG announced that its subsidiary Westinghouse Rail Systems Australia (WRSA) has been selected by Connex Mainco Joint Venture (CMJV) to provide A$4.5m worth of signalling equipment and services for the Laverton rail upgrade project in the State of Victoria, Australia.  The project is part of the A$38b Victorian Transport Plan which aims to deliver extra trains and services to the busy Werribee corridor by the end of 2011.

Under the contract, WRSA will replace the existing life expired relay interlocking at Laverton with a Hot Standby WESTRACE interlocking.  The WESTRACE is being provided in a “Hot Standby” configuration with diverse communications links – resulting in high system availability and reduced downtime in the event of a failure.  WRSA will also replace the existing manual unit level Newport panel with a new WestCad VDU control system.  The new VDU based system will interface with a total of six different interlocking; four relay, one solid state interlocking and the new WESTRACE.

“From a technology point of view we have assembled a complete solution from robust system elements.  Our ability to integrate solutions from these elements is one of our great strengths as an organisation.  Although the site presents a number of challenges, we have worked with the client to develop an innovative contract structure that enables the risk to be dealt with efficiently at minimal cost to the client.  We believe our design solution was an innovative one, designed to increase service levels and capacity of the Werribee corridor by creating a ‘short starter’ station at Laverton” said WRSA’s Managing Director, Phil Ellingworth.

WRSA has to design, test, install and commission the new control centre and interlocking by September 2009, when work begins on the relocation and reconfiguration of the existing track layout.

WRSA has been active in Victoria for over 120 years and continues to commit to local delivery integrating the most appropriate technologies from around the globe to deliver value added customer solutions.