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West Somerset Railway General Discussion

Discussion in 'Heritage Railways & Centres in the UK' started by gwr4090, Nov 15, 2007.

  1. MellishR

    MellishR Resident of Nat Pres Friend

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    Nor me. Even after someone mentions "The Borrowers" I still have no idea who the people in the picture are, nor their relevance to the WSR.

    Edit: the light begins to dawn if "The Borrowers" means borrowing money rather than small household items as in the children's books.
     
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  2. Keith Sims

    Keith Sims Member

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    I notice that there is a very restricted service on 26th.27th of June and 2nd. July. There is no explanation on the official website. Can anyone enlighten me on the reason for this reduced running.
     
  3. 1472

    1472 Well-Known Member

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    The reason is a positive one due to the private hire of certain sections of the line.
     
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  4. KA-2B

    KA-2B New Member

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    I believe it is for a filming contract but don't know any more details than that.
     
  5. 35B

    35B Nat Pres stalwart

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    That was my conclusion when someone told me what the image was. The question, which @Jamessquared has partly answered, is then about the level of debt and the ability of the railway to generate cash to pay it back. Other railways with debt burdens appear to be needing to run appeals and/or cut expenditure to keep afloat.
     
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  6. ikcdab

    ikcdab Member Friend

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    My understanding is that due to private hire of individual sections of the line, on 26th – 27th June the public train services will be Minehead to Williton only.
    On 2nd and potentially the 3rd July public services will be between Bishops Lydeard and Watchet only. I also understand that the mainline charter on 2nd July will run as planned.
    Ian C
     
  7. Jamessquared

    Jamessquared Nat Pres stalwart

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    My reading of the accounts is that the WSR is by and large on top of their running expenses - that includes the direct operational costs (coal, oil etc); salaries and servicing their debts, including paying them back at the agreed rate.

    What is much harder to judge is how much a maintenance backlog they have, and whether that backlog is increasing or decreasing. The evidence for that would largely not be especially obvious in the accounts. (For example - how many carriages are available for traffic? What proportion of the line is subject to speed restrictions on account of infrastructure etc?; and how are those numbers changing over time?)

    Without making a specific comment about the WSR, debt is important but it is only one part of the accounts. It would be possible to run a line for many years in which you covered your costs each year, but gradually the infrastructure got worse, or the average age since overhaul of your carriages increased. Indeed, that is probably how many lines in the country are managed, looking then for altruistic giving to plug the maintenance backlog. It's long been common place for locomotives to have independent support groups that essentially subsidise their operation, so it hardly a heinous crime to admit that the direct operational revenue doesn't cover the renewal costs; but it is hard to get a direct sense of that just from the accounts.

    What I think is really striking - and not in a good way - about the WSR plc accounts is just how stagnant the turnover is. In 2022/23, the gross turnover was £2.89million. 10 years ago in 2013 it was £2.85million. If you assume that like-for-like wages and costs have broadly risen with inflation in that time, but income is static - that's not a good position.

    That's not meant as a dig at the WSR, and I am sure there are other examples of lines in a similar boat - indeed, I know on the Bluebell we spent a number of years when revenue didn't't really change much from year to year. But I'd suggest if the WSR is going to find a way to finance the necessary renewal work, finding a way to dramatically increase revenue in a profitable way has to be a key focus. It's back to a theme that has often been raised on this thread - the need to find another 50,000 passengers. I suspect that is not at all easy given the nature of the WSR as a "journey to a destination" type line, rather than "the railway is the destination" attraction. Some of the family-friendly type activities that many other lines are promoting seemingly successfully are much harder to pull off if your core product is based around people riding on a train and getting off to go to the beach at the far end, rather than getting on and off and visiting off-train activities at intermediate stations over the course of a day.

    Tom
     
  8. 21B

    21B Part of the furniture

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    I put £2.89m into a CPI calculator to find out what the equivalent purchasing power is today. Alarmingly the answer is £4.15m. CPI having averaged 3.35% p.a. over the last 10 years. Like you I doubt the WSR is the only HR to face this issue, in fact I know there are others in as or more perilous places, some public knowledge and others not so.

    I think the gap is more like 100,000 visitors?
     
    Last edited: Jun 4, 2024
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  9. 1472

    1472 Well-Known Member

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    That assumes that the operation 10 years ago is still the same today. You would need to compare the two WTTs to form a reasonable conclusion. In many HR cases you would find quite a difference.

    In reality the post covid train service is considerably reduced from that of 10 years ago (fewer operating days, fewer steam hauled services) - as it is on many lines.

    Some costs are of course incurred how ever much you run trains, others are more directly related to the number of days you are running.

    The comparison above is an over simplification but this is a real issue.
     
  10. 21B

    21B Part of the furniture

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    I’m not so sure that the WTT is relevant. We aren’t comparing costs (which by definition almost, will not have fallen) but revenues which haven’t kept pace with inflation. Unless the railway has a) cut costs by 40% or b) created new funding streams to offset the fall (in real terms) in receipts, then the railway must be worse off today than it was in 2013. It most certainly has less money (in real terms) from its sales to cover its expenditure.
     
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  11. Paul_Turner

    Paul_Turner New Member

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    I think that’s missing the point - you do have to look at both. Revenue may be flat but if it is earned from fewer miles then variable costs will have reduced in absolute terms even if units costs have risen. That gives a truer picture.
     
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  12. Jamessquared

    Jamessquared Nat Pres stalwart

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    But the problem with that view is that most of a railway's costs are fixed - not least the need to maintain a fixed length of infrastructure.

    Many railways have cut back services since Covid - but in the main, I'm not aware of any who have objectively done so with the aim of cutting back income. For example, if you were previously carrying 3,500 people per week over 7 days, the thought has been "can we still carry 3,500 per week over five days with higher loadings" - because if so, you get the same income at lower direct cost. What you don't want to do is say "let's cut back two days to reduce costs and carry 2,500 people at the same loadings" - since if you do, you have less surplus after direct costs to cover your fixed costs.

    The fixed costs are the killer on a heritage railway; you can't cut your way out of financial issues by simply reducing your service to save on your variable costs.

    Tom
     
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  13. 35B

    35B Nat Pres stalwart

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    There is also the question, lurking since pre Covid on the WSR, of capital investment.

    The credibility of claims about “best shape ever” is tested not just by local history and the level of borrowing and mixed views of the state of the rolling stock, but also the claims of very significant investment being required to bring the railway infrastructure up to scratch.

    From afar, it’s not clear how much has been done to fix that structural deficit on the infrastructure that was then claimed - and which I don’t believe anyone seriously questioned.

    Add in high levels of borrowing, and the story seems confused.


    Sent from my iPhone using Tapatalk
     
  14. Lineisclear

    Lineisclear Member

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    James hits the nail firmly on its head. The other thing you can't do is expect to survive by flogging a dead horse. Fixed costs have escalated to the point where for many the traditional heritage railway business model is not sustainable. That was built typically on the assumption that income from ticket sales,membership fees and secondary spend, supported by volunteer labour, would generate a surplus sufficient to cover variable and routine fixed costs with development and enhancement projects funded out of grants and appeals. It's increasingly evident that for many heritage railways that business model no longer works and that there's probably no going back. So, how do they move forward? There's no universal formula for survival. Some may concentrate on crowd pleasing special events, some may hire out their railway to commercial operators for training or testing while others may focus on their charitable status to secure grants and Gift Aid. The one strategy that is unlikely to succeed is trusting that the traditional heritage railway model will work in the future in the same way it did in the past. Those that can't adapt may not survive.
     
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  15. jumper

    jumper New Member

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    A quick look at Companies House shows shares of 181100 and 132300 being allotted recently.
     
  16. 35B

    35B Nat Pres stalwart

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    And whichever of those models - or any other - is adopted, it is critical that if the railway relies on supporters, it shares what it is trying to do. The challenge with WSR is that there have been a number of mixed messages, followed for the last few years by near blanket silence.

    I come back to an earlier observation - if they've got it right, then there's something important that should be shared more widely as others can learn. Alternatively, there may be other, less favourable, interpretations of what the silence has to say about the story.
     
  17. 21B

    21B Part of the furniture

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    For once I find myself almost entirely in agreement with you. The only thing I would suggest is that there is no one strategy for any railway. It is a trap I have seen many fall into over the years (not you, just generally): believing that this or that “one” thing will fix all problems. Actually it’s never just one thing of course you have to do everything that makes sense for that particular railway.

    In my view those that survive will be those who are good at constantly inventing (or adopting) new ways to generate income as well as nurturing and sustaining for as long as possible the old ways as well. It will be those that seek to encourage new groups and audiences to visit and participate, that reach out and invite people and communities that never even knew the railway was there to see it as something “for them”. Truthfully there aren’t many who do.

    we have to make our railways mean something and be valuable (and seen to be valuable) to local and at least regional communities outside of the not only the railway enthusiasts, but also beyond the existing market of people that know of any particular line. It is astonishing how many people I meet in the course of my business and outside interests who don’t even realise that steam railways exist, much less ever considered riding on one. A survey at a major heritage line a few years ago found that >70% of passengers were repeat customers. Great news we’re delighting our customers. Yes, but at that level of repeat business you’re probably only just holding numbers firm against deaths, moves from the area and other reasons why repeat customers eventually stop. There is no strong likelihood of growth.

    I think it is true that growth in visitor numbers cannot of itself fix the escalating fixed cost problem. We are at a point where structures are now becoming life expires and heavy stuff like bridges need to be replaced. No amount of visitor growth that could be accommodated will create sufficient surpluses to pay for that. New income streams are needed. Even with the changes to HLF and the reduction (it seems) in availability to heritage railways grants are still available, but you need to be structured in the right way. And you need to work hard at securing those grants.

    I wouldn’t like to try to predict who might fail or when. Even some that do may rise again like Llangollen did. But, I know there are a several - not all of whom have been mentioned on this forum as potential loses that are in really hard places. Harder or as hard as the WSR might face. The evolution of management thinking needs to speed up, and boards and management need to remember, and act on one key aspect above all others - it’s all about how people perceive the railway. Get the different stakeholders perceptions right, and the rest is much easier.
     
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  18. johnofwessex

    johnofwessex Resident of Nat Pres

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    Wasnt Swanage looking at a turnover of about £3 million and thats for a much shorter line?

    Watercress Line Ditto

    That seems to be the issue
     
  19. Robin Moira White

    Robin Moira White Resident of Nat Pres

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    It would all be soo much more reassuring if there were a properly costed PLAN in the public domain.

    Even passenger numbers appear to be a state secret. I'm a little busy this week, but it would be interesting to see when year-on-year totals were last published and what has leaked out since. We KNOW its been tough post-covid but hidden figures inevitably seems worse than the reality which, likely, reflect the efforts being put in.
     
  20. bluetrain

    bluetrain Well-Known Member

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    Interpretation of annual accounts tends to call for more business and accounting knowledge than I possess, plus an ability to see through whatever spin a Board is trying to put on the data.

    Having said that, WSR accounts seemed to be more open in former years. The WSR appeared to grow rapidly in passenger numbers and turnover between the mid 1990s and 2009, when passenger numbers peaked at 226K. A slow decline in passenger numbers and flatlining of turnover then took place during subsequent years. I suspect this was a common pattern across many heritage railways, reflecting the ups and downs of the national and international economies. In the case of the WSR, it may also reflect the factional infighting that seemed to take root from around 2010, which must have deflected the attention of Board members and managers from actually running the railway.
     

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