[Marxism] Apropos of the Miracle of Railway Expansion in China

S. Artesian sartesian at earthlink.net
Tue Sep 1 07:35:16 MDT 2009

Sorry for the long "cut" of the article, but I wanted to be fair and include 
the partially positive passenger service results, with the negative freight 
service results.


Guangshen Railway Company Limited ("Guangshen Railway" or the "Company") 
(HKEx Share Code: 525; SSE Share Code: 601333; American Depositary Shares 
("ADS") Ticket Symbol: GSH) today announced the unaudited interim results of 
the Company and its subsidiaries (the "Group") for the six months ended June 
30, 2009 (the "Period").
During the Period, operating revenues of the Company amounted to RMB5,858 
million, representing an increase of 4.23% over the corresponding period 
last year. Profit from operations amounted to RMB867 million (2008 interim: 
RMB924 million). Profit attributable to equity holders amounted to RMB595 
million (2008 interim: RMB674 million). The board of directors of the 
Company does not recommend the payment of any interim dividend for 2009.

Mr. He Yuhua, Chairman of the Company said, "In the first half of 2009, due 
to a decrease in demand for railway passenger and freight transportation 
services caused by the global financial crisis and the H1N1 swine flu, 
coupled with factors including an increase in operating costs resulting from 
the expansion of the Company's operating scale and an increase in finance 
costs, the Company was faced with tough challenges in its operation and 
management. Faced with various difficulties, the Company has strengthened 
its sales and marketing efforts to increase traffic and revenues, 
consolidated and enhanced transportation resources to improve transportation 
capacity and efficiency, and actively controlled costs and expenses, thereby 
achieving a growth in transportation revenues."

During the Period, passenger delivery volume of the Company was 41,316,000, 
a year-on-year increase of 1.10%. Revenue from passenger transportation rose 
7.68% year-on-year to RMB3,512 million. Of such amount, the passenger 
delivery volumes of Guangzhou-Shenzhen trains, Through Trains and 
long-distance trains amounted to 16,172,000, 1,599,300 and 23,544,800 
respectively, representing year-on-year increases of 3.90% and 2.42% and a 
decrease of 0.82% respectively; and realizing revenues of RMB990 million, 
RMB181 million and RMB2,341 million respectively, representing an increase 
of 2.86%, a decrease of 5.85% and an increase of 11.11% year-on-year 

Both passenger delivery volume and revenue of Guangzhou-Shenzhen trains 
posted growths mainly attributable to a considerable increase in passenger 
delivery volume in January and February as compared to the corresponding 
period last year, owing to this year's absence of natural disasters such as 
heavy rains, snowstorms and freezing weather during the Lunar New Year. In 
addition, Guangzhou-Shenzhen trains began to stop at each intermediary 
station from May 1, thereby stimulating the growth of passenger traffic at 
intermediary stations. Meanwhile, the introduction of the Guangshen Railway 
Peony Credit Card and the Guangshen Railway Fast Pass Card has facilitated 
traveling and attracted more passengers.

In respect of long-distance trains, passenger delivery volume did not grow 
along with the increase in number of operated trains or the increase in 
transportation capacity, mainly due to the global financial crisis and the 
H1N1 swine flu. However, revenue from long-distance trains recorded a 
considerable increase, mainly owing to the reason that the Company has begun 
to undertake the operation of T97/8 trains from Beijing West to Kowloon 
(Guangzhou East) effective from January 1, 2009, thereby leading to a 
considerable increase in the relevant revenue.

As regards Hong Kong Through Trains, due to the significant increase in the 
number of mainland passengers visiting Hong Kong, Beijing-Kowloon trains, 
Shanghai-Kowloon trains and Zhaoqing-Kowloon trains contributed to an 
increase in passenger delivery volume of Through Trains. However, the 
passenger traffic of Canton-Kowlon Through Trains, which had a higher 
average passenger revenue, recorded a substantial decrease under the impact 
of the global financial crisis and the H1N1 swine flu, thereby leading to a 
decline in Through Train revenues.

During the Period, tonnage of freight transported by the Company amounted to 
26.5406 million tonnes (2008 interim: 34.5508 million tonnes). Revenues from 
freight transportation reached RMB506 million (2008 interim: RMB636 
million). The decreases in the Company's tonnage of freight and revenues 
from freight transportation were mainly due to the considerable declines 
recorded in both the Company's outbound and inbound freight tonnages which 
were in turn caused by the global economic crisis and the slowdown of 
China's macro- economy.

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