GETLINK

Analysis of Getlink share price

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Transport, particularly rail transport, is one of the activity sectors that generates a lot of revenue, even in times of crisis. This is the reason why the privatisation of certain French and European companies in this sector have developed into interesting IPOs on the stock markets. Among the shares that investors like to trade online is Eurotunnel, whose specificities and practical information we invite you to discover here.  

Latest news

Getlink's results fall sharply in 2020

22/01/2021 - 12h33

Because of the Covid-19 pandemic, the Getlink group, formerly Eurotunnel, announced yesterday sharply lower results with, in particular, a loss of a quarter of its turnover. Explanations and details.

Elements that can influence the price of this asset:

Analysis N°1

Innovations and technological progress that improve the group's industrial competitiveness.

Analysis N°2

The expansion of the US economy is also an important point that will allow GetLink to further develop its growth and activities.

Analysis N°3

The level of end customer revenues that will of course influence user preferences and reveal new trends in this sector of activity.

Analysis N°4

Demographic changes that influence the number of potential customers in the transport segment.

Analysis N°5

Trade relations between the United States and China that may affect the company's growth plans as part of its development in China.

Analysis N°6

The threat of legal action and the evolution of WTO regulations and laws that are sometimes complex to apply in some markets.

Analysis N°7

Direct competition from this company and all major publications

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General presentation of Getlink

The Eurotunnel Company is naturally the company that manages and controls rail transport under the channel, between France and the United Kingdom. This transport is for both passengers and vehicles. A large part of its activity also concerns freight transport.

Due to the diversification of its activities, notably in terms of marketing and communications, the Eurotunnel Company has seen its turnover increase considerably over recent years, currently reaching over one million Euros.

If you are looking to trade Eurotunnel Group shares, you should be aware that the company has recently changed its name to Getlink. You will therefore no longer be able to find shares under the old name Eurotunnel but only under this new name, which is valid from November 2017.

This name change was decided by the group's management and justified by the fact that the company wishes to mark its entry into a new era of mobility infrastructures. However, on the Euronext Paris and Euronext London stock exchanges on which the stock is listed, the stock exchange code remains the same, i.e. GET.

Eurotunnel's name remains valid, but only in relation to Channel Tunnel activities. The new entity thus named Getlink therefore brings together the activities of Eurotunnel, Europorte, which is the leading private rail freight operator in France, ElecLink, which concerns the future connection between France and the UK for electricity through the Channel Tunnel, and CIFFCO, a private training centre for railway professionals.

However, the way of trading on this stock remains the same as before and the indicators are also identical.

Analysis of Getlink share price
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The major competitors of Getlink

The Getlink group is nowadays indisputably number one in its sector as it holds the monopoly in the underground channel crossing. However this is not all. Having benefitted from the rapid decline in maritime companies offering ferry and speedboat crossings, it has proceeded with certain specific purchases of boats that cement its position as leader.

There is therefore no serious competitor to Getlink at this time and to conclude this sector therefore has no real interest for you if you are trading in Getlink shares on the stock market. However, it is recommended that you monitor any merger or acquisition operations in the maritime transport sector, particularly any that may concern Getlink , as well as transport that takes place away from the France / United Kingdom connection. It is not impossible that in the future this group invests in other geographical zones worldwide after its successful experience with the Channel Tunnel.


The major partners of Getlink

Getlink has among other things implemented several partnerships that have enabled it to increase its advantages and become even more profitable.

Europorte

Europorte, a rail freight subsidiary of Getlink, and Alstom have notably signed a partnership agreement covering the maintenance of 17 Prima locomotives, built by Alstom and currently used by Europorte. This is with the aim of improving the management of the Europorte locomotives and their availability.

Orange

Getlink also partnered with Orange who supplies 4G to passengers travelling through the Channel Tunnel.

Alcatel-Lucent

In the past, Getlink has already partnered with the Alcatel-Lucent Company to enable accessibility to telephone networks in the Channel Tunnel.  

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The factors in favour of a rise in the Getlink share price:

One of the most effective ways of anticipating the growth capabilities of a stock market asset is of course to understand how the issuing company could react in the future, how the company can increase its profitability or if it is at risk of a negative downturn. This is exactly what we will now examine as we assist you in evaluating the abilities of the Getlink Company through a detailed summary of its principal strengths and weaknesses. 

We will commence this comparative study of the strengths and weaknesses of Getlink with a reminder of this group’s major advantages which represent factors that could promote a future rise in its share price:

  • Firstly, one of the major strong points we should detail here concerning the Getlink Company and its share price relates to the fact that this company is a rail transporter as well as a user of the cross channel line under concession through a contract that lasts until 2086. This operational activity alone represents over 70% of this group’s turnover. 
  • The Getlink group has also shown itself capable of diversifying its activities notably through the implementation of shuttle services which generate 13% of this company’s turnover, and the continental rail services as well as the channel tunnel network. 
  • Still on the subject of this company’s advantages it is important to take into account the revenue provided by the strong lorry market, the growth of this particular sector is estimated to exceed 2.5% per year for the coming years.  
  • Another undeniably strong point of this asset concerns investments completed by this group with the aim of generating new income such as new passage through the tunnel which could generate additional revenue at only a fractionally higher cost.
  • We are also pleased to note the high visibility of the expected future turnover of the group as well as the continued growth over the last few financial periods. In fact the turnover of the Getlink Group is notably supported by the recovery of the British economy which alone accounts for the two thirds of this group’s turnover in the United Kingdom.  
  • Other recent strategic operations have also been particularly advantageous to the Getlink Company including the recent opening of the Channel Tunnel with the German company Deutsche Bahn which completed the London Frankfurt and London Amsterdam links representing no less than 4 million supplementary passengers per year. It should be noted that this increase is significant as before this alliance was implemented the tunnel accounted for the transport of 10 million passengers per year.
  • Another undeniable advantage of the Getlink Company concerns the advantage it holds against its competitors in the ferries sector due to the recent environment regulatory constraints that were introduced in 2015. These measures in fact enabled Getlink to gain new parts of the market relating to the channel crossing with 40% for vehicles and 60% for the passengers.  
  • And the final advantage that we shall examine here relates directly to the finances of the Getlink Group and concerns the clear and continuing increase in the company’s operational profitability which can be observed over the last few years as well as a regular rise in the dividends paid to shareholders.  
The factors in favour of a drop in the Getlink share price:

After learning about the major advantages of the GetLink Group we now offer you the opportunity to learn about this company’s disadvantages. In fact this group does have some weak points that should be taken into consideration as follows:

  • Firstly we should note our disappointment with this group’s activities which are often subject to the various British and European regulations which represent a double constraint. 
  • Also, although Getlink is in a strong position against the competition from the ferries it does face greater difficulties against competitive airlines, notably those operating the Paris London flights.
  • We also note that Brexit has created a certain amount of complexity relating to the generation of this company’s income due to its significant exposure to the foreign exchange rate between the Euro and Sterling Pound.  
  • In much the same manner, this group’s activities currently suffer from the rise in the risk of terrorist activities in Continental Europe which is particularly aggravated by the refugee camps close to the Calais terminal. 
  • To conclude, the last major weak point that we shall examine here concerns the debt level of the Getlink Group. In fact although the financial debt of this group is fairly well controlled it still remains quite large and, a noteworthy point, is only expected to be repaid after a lengthy time period. The repayment of this debt has in fact already lasted nearly 30 years now and therefore weighs significantly on this group’s profitability.
The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Eurotunnel’s rail infrastructure management activites :

To understand better how does the Eurotunnel group manages its development, it is necessary to differentiate its two main activities, which are the management of the rail infrastructure and the railway company itself. We are first going to focus on the company’s management of the rail infrastructure.

Let’s recall that the Eurotunnel company owns the channel tunnel and is therefore in charge of the operation of the infrastructure and of making possible for companies with a license to operate the rail freight services and transport passengers from the trail paths of this tunnel. It also generates revenues from the collection of toll taxes from third party rail companies using the tunnel. Among the main known users, we can mention for example the company Eurostar in charge of the transportation of passengers, the SNCF, EWS, Deutsche Bahn as well as the Europorte company which manages only the transportation of merchandise.

In total and since it was put in service in 1994, the Channel tunnel has enabled more than 400 million passengers to traverse the English Channel. Among those travelers we count of course the passengers of the Eurotunnel shuttles as well as the passengers from Eurostar.

Of course, Eurotunnel is also in charge of the maintenance of these infrastructures through different other businesses.

 

Eurotunnel railway activities:

Of course, the Eurotunnel group is also a full-fledged railway company. It offers transportation services in the Channel tunnel as well as transport services all over Europe.

Concerning the cross-channel rail transport, Eurotunnel operates both the piggyback shuttles such as shuttles carrying trucks and others transporting cars, camping cars, caravans and couches as part of its connections between the terminals of Calais in France and Folkestone in the United Kingdom. Every year, not less than 18 million tons of merchandise and 17 million passengers traverse the channel. Over the last 20 years, the company has transported more than 60 million vehicles under the channel, also achieving a reduction of CO2 emissions of more than 4 million tons. In 2009, it obtained the Carbon Trust Standard certification as a reward for its environmental and ecological policy as well as for its efforts to control and reduce its carbon footprint. But in 2012, it was the other subsidiaries of the group that received this certification after the reduction of nearly 44% of its carbon production between 2006 and 2008. This reduction is expected to increase to 55% in 2011.

Eurotunnel is also the first private operator to have obtained a European license for railway operations in 2004. Since then, it has been able to develop the company Europorte which implements all the expertise of the company. This structure should be studied since it comprises the French assets acquired by the group from Veolia Cargo which we now know under the name of Europorte France for the transportation of rail freight, Europorte Link for the transport of maritime containers, Europorte Proximity as a local operator, Socorail as a specialist in industrial railway sidings and Europorte Channel formerly known as Europorte 2, which specializes in the traction of the Channel tunnel and in ground operations. With not less than 1800 employees, Eurotunnel’s Europorte company generates a turnover of more than 100 million Euros annually.

 

Other activities carried out by Eurotunnel:

In addition to its two main activities concerning rail transport and the management of the infrastructure, Eurotunnel carries out many other activities that are also important to know here are the details:

First of all, we can site, the company’s railway training activities since it has set up a real internal training center, called CIFFCO for the Opal Coast International Railway Training Centre. This training center addresses to external companies of the Eurotunnel group, which is an exception since most trainings are usually provided by railway companies for their own employees. This training center is located in the old business center of the Eurotunnel French terminal site. It offers different trainings in different jobs of railway transport and offers the following certificates:

Of course, this training center has the advantage of having all the educational material necessary to train for these jobs such as advanced computer equipment, a driving simulator and train tunnel evacuation simulator. Launched in 2011 and inaugurated in 2012, the CIFFCO was able to register its train conductor training in the national directory of professional certifications. Later on, in 2016, Eurotunnel and its training center launched the first MOOC railway job.

And finally let’s talk about Eurotunnel ships. In fact, during the closing of the Seafrance company in 2012, Eurotunnel bought assets of this company concerning three boats. It also acquired the Sister ship Rodin and Berlioz and the Nord Pas de Calais. This purchase was validated after the decision of the Paris court in favor of Eurotunnel against its two opponents Louis Dreyfus/DFDS seaways and Stena Line who had made an offer too. The amount of this purchase was around 65 million euros for a fleet whose value was estimated to be between 150 to 200 million euros. However, it should be noticed that Eurotunnel does not operates these boats directly because he rents them to a SCOP created by old employees of the Seafrance company called My Ferry Link. Those boats also offer trips between the ports of Calais in France and Dover in United Kingdom since 2012. In fact, in 2015, an interdiction for Eurotunnel to operate ferries between these two ports was confirmed by British courts. This decision was taken after a first interdiction issued in 2013 by British competition and markets authority.

 

Structure and distribution of Eurotunnel’s shareholding:

To finish this article, we now invite you to find out more about the structure of Eurotunnel’s shareholding.

Let’s first recall that Eurotunnel currently has around 220 000 shareholders around the world. The average portfolio has around 7257 shares for a total of more than 550 million shares in circulation.

A more complete study about the distribution of its shareholdings was carried out in January 2017 on the basis of the TPI 1000 shares by the nominative register of the General society of Securities services and Computershare.

 We find out about the distribution of the company’s shareholding by types of shareholder with:

The study also shows the geographical distribution of account holders whose details are as follows:

Frequently Asked Questions

How did the Eurotunnel share price progress over the 2019 financial year?

During last year, the 2019 financial year, the Eurotunnel share price took a downwards turn and lost 21.88%. The average transaction volume over this year was 1,120,211. We also note that the highest historical point achieved over this year for this share price was €17.04 and the lowest share price was €8.62. In 2020 the company possessed a stock market capital of €5.929 billion.

What is the capital structure of the Eurotunnel Group?

In March 2020 information released by the GetLink Company, previously called Eurotunnel, relating to its capital structure and according to the type of shareholder was as follows: 50% of the shares are held by institutional investors, and 44% by holding companies, with 4% held by individual shareholders and the remaining 2% are owned by the company.

When did Eurotunnel become GetLink?

In 2017 the Eurotunnel Group changed its name and became GetLink with the aim of gaining support for its transformation, turn the page on its troubles and return to its beginnings with a name that sounded more international. This new name still covered all the activities of the group, complementing its historical activities as channel tunnel operator. Eurotunnel is still however the name of the subsidiary that is responsible for the tunnel operation.

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