Next month, the management of České dráhy, a. s., will present a proposal for active measures to be taken to further improve the efficiency of the economic and business activities of the company.
At its meeting yesterday, the České dráhy, a. s. Steering Committee, which is an inter-ministry body, through which the state exercises its rights as a shareholder in this company, received the preliminary results of the company’s finances in 2004. The representatives of the shareholder set out a clear goal – to make České dráhy, a. s. profitable, as early as in 2006, through the implementation of, among other things, strategic measures which would lead to a further improvement in the efficiency of the economic and business activities of the largest Czech railway transportation company.
The Steering Committee also noted that České dráhy, a. s., has undergone many changes recently, which significantly aided the gradual improvements in the company’s financial management and in the company’s ability to function better in the liberalised environment in railway transportation. The outcome of the extensive transformation process is then – aside from the creation of conditions for improving the company’s financial results – a number of specific changes both in commercial policy in passenger and freight transport, and the gradual improvement of the quality of the services offered.
The members of the Steering Committee, and the management of České dráhy, a. s., agreed that in the near future emphasis will have to be put on the further development of trends in railway freight transportation, which is impacted by the removal of barriers to road transportation, after the Czech Republic joined the EU. One of the primary spheres is the transportation of commodities – such a coal, chemical products, loose substrates, and others.
The České dráhy, a.s. Steering Committee decided for the continuation of the process of changes, so that the company could finish “in the black” in 2006. The company should also strengthen its position in order to be fully able to use its potential and business opportunities offered to it on the Czech and European Union transportation markets.
The members of the Steering Committee therefore asked the Board of Directors of České dráhy, a.s. to elaborate the following processes which would ensure an even greater dynamism of the transformation process:
• The elaboration of a short-term plan of “active measures” – setting clearly measurable criteria for the implementation of rapid change in the company, which would lead to a further improvement of the efficiency of its financial management and business activities. These “active measures” should concern primarily the sphere of freight transportation provided by České dráhy, a. s.
• The elaboration of a long-term strategy of České dráhy, a. s., with a proposal for the most economically advantageous company management structure for the future, in order that the company may become even more competitive on the liberalised railway transportation market. The long-term strategy should also help meet all preconditions for the achievement of the primary goal – the profitability of ČD, a. s., as early as in 2006. The company’s management should also, as part of the long-term strategy, set out priorities in the work of ČD, a. s., which would lead to further economic development and to increasing the value of the company for its shareholders.
The representatives of the shareholder agreed with the management of České dráhy, a. s. that a proposal of the above-mentioned “active measures” would be prepared in April 2005, so that the first results of their implementation could be discussed at the June 2005 meeting of the Steering Committee. The long-term strategy of České dráhy, a. s. will be presented to the Ministry of Transport, which will ensure that it is presented for evaluation to the Czech Government in the 1st half of 2005.
Contact person for further information:
Ministry of Transport Press Spokesman
Marcela Švejnohová, tel.: 724 056 366, e-mail:
marcela.svejnohova@mdcr.cz