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České dráhy Has Issued Its First Green Bonds

5.10.2022 - 17:06

České dráhy has successfully issued bonds amounting to EUR 500 million with a maturity of 5 years and bearing a fixed interest rate of 5.625%. For the first time in the company’s history, the issue concerned green bonds. The bond issue was managed by Erste Group Bank, ING Bank, Société Générale Group and UniCredit Bank. The national carrier will use the funds raised to finance the purchase of new trains and other green projects. A part of the proceeds of the bonds will be used to repay some other liabilities of the company.

"I can see great potential for further growth of České dráhy mainly in international long-distance transport and in increasing the occupancy rates of train services operated. A necessary precondition is just modernisation of the rolling stock. Wherever we deploy new trains, we attract more customers. A typical example is the Prague – Plzeň – Cheb line, where the most modern long-distance carriages in Central Europe are currently running," says Michal Krapinec, Chairman of the Board of Directors and Director General of ČD, and continues: "As a business entity, we do not receive funds from the state budget for the purchase of trains. We have to secure financing by ourselves on a commercial basis. That is why we are looking for the most advantageous options, such as financial resources from Eurofima or the ESG bonds that have just been issued."

České dráhy invests in the renewal of its rolling stock on a long-term basis. With regard to the possibilities of regions and the Ministry of Transport to order completely new trains within the framework of public transport, the replacement is taking place as an ongoing process. The newest vehicles are now running in the Plzeň and South Bohemian Regions, and others will be delivered to the Olomouc and Moravian-Silesian Regions, for example. However, new train sets are also in production for other regions and for long-distance express lines.

"At present, we have ordered more than 230 more modern units and locomotives, which means altogether some 750 individual vehicles. For long-distance services, we are acquiring ComfortJet train sets, while additional RegioPanters or RegioShark diesel multiple units are intended for the regions. With some regions, we are already discussing the possibilities of deployment of hybrid trains, which are to be even more environment-friendly," adds Michal Krapinec commenting the use of funds from the bonds issued.

České dráhy was one of the first large companies in the Czech Republic to use the possibility of issuing green bonds. These reflect the fact that České dráhy is active in the area of ESG (Environmental, Social and Governance). "Investors count on the fact that the company operates in a sustainable manner, and thanks to this fact we can borrow on more advantageous conditions. Railway transport is environment-friendly and energy-efficient by its very nature. However, we intend to further develop and push this aspect ahead. As well as all other ESG activities, whether it is about equal rights for different social and societal groups or taking care of our employees," adds Lukáš Svoboda, Member of the ČD Board of Directors and Deputy Director General for Finance and Procurement.

"At the same time, this week we have joined the RETHINK project. This open platform brings together large companies operating in the Czech Republic, which have decided to cooperate with each other and to share their experience in supporting the achievement of long-term climate neutrality. As a national carrier, we want to be active within the framework of promoting environmental responsibility," concludes Lukáš Svoboda.

 



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