WEST Somerset Railway faced being killed off as a going concern unless shareholders backed a plan to delay publishing the company accounts, an extraordinary general meeting of the railway was told.
A total of 100 of the 102 shareholders voted to delay revealing the accounts for three months.
This will give directors and auditors a chance to look at this summer’s improved trading figures alongside last year’s 15-month loss-making accounts to show that the business can continue.
The decision came after WSR vice-chairman Mark Smith said shareholders were facing a stark choice.
The 15-month accounts were so poor that publication could well kill the railway off as a going concern.
He said: “If we get it right today, then we will have a railway going forward. But if we get it wrong then we’ll have a cycle track. It’s that simple.”
The meeting was told that in the past year the line had not been running smoothly. Rail inspectors had demanded improvements which resulted in a three-month closure, and a new board had been dismayed by the state of the accounts.
Mr Smith said the board had been shocked by the 15 months of poor trading figures and by the scale of the losses. But financial performance had improved this year.
Money was now in the bank and figures for April to October were expected to confirm that WSR was now a viable business and that the current business model being followed would guarantee a strong future. Support had also come from the Railway Association and the Steam Railway Trust, and the Rail Renewal appeal now stood at £80,000 of the £250,000 set for this year.
WSR chairman Jonathan Jones- Pratt said that last year’s very serious financial situation had put the company at risk of insolvency and the 2018 accounts would make ‘dismal reading’ when finally published.
But he confirmed that the threat to WSR was finally diminishing thanks to some drastic cost-cutting measures and prudent management of resources which meant that the railway had not had to use its overdraft facility.
Mr Jones-Pratt said that the vote to defer publication of the accounts was, in effect, ‘the start of the recovery process’ and that the board and management had to get everything right throughout the railway and its constituent parts.
He added: “After analysing and identifying the peaks and troughs of WSR train services this year, the train timetables will be different in 2020 going forward, so that we avoid being ‘busy fools’ running empty trains. “A budget is being created to generate a surplus to invest back into the railway, and the end result will be a better railway which allows for both steam and diesels to operate.”
He said: “But the WSR will always be a core steam railway operation.”