THE private ferry company which runs the frequent vehicle-carrying service between Gourock and Dunoon has highlighted the impact of soaring fuel prices as profits dipped in its most recent financial year, while signalling its interest in acquiring new routes to operate on Scotland’s west coast.

Dunoon-based Western Ferries (Clyde), which has been celebrating its 50th anniversary in 2023, reported a pre-tax profit of £2 million for the year ended March 31, down from £2.5m the previous time.

While turnover increased to £9.63m from £8.98m, operating expenditure climbed to £7.7m from £6.5m, putting pressure on the bottom line, accounts newly filed at Companies House show.

Managing director Gordon Ross said the results were “reasonable” in the context of a “substantial spike in fuel costs”, sparked by Russia’s invasion of Ukraine, “which obviously ripples through all the costs of the business”.

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Mr Ross said: “There is a direct impact on the fuel, but of course that flows through our suppliers’ costs. One of the things you will see in the accounts is a fairly noticeable increase in operating costs, the vast majority of which is associated with the price of fuel.”

The Western Ferries service, which connects McInroy’s Point in Gourock with Hunter’s Quay in Dunoon, provides a gateway for tourists to discover the Cowal peninsula and the wider Argyll and Bute region. Mr Ross said that the period covered by the accounts had seen a rebound in visitors following the pandemic, stating that the “momentum continues” in the current year.

He also welcomed the recent easing of fuel prices, but warned that “there is still so much uncertainty with what else is going on in the world just now”.

Mr Ross said: “One thing we are always pleased with is providing Scotland’s most frequent, most resilient, and reliable ferry service. Our carryings are solid. It was a good year. We are still seeing a positive return of people to travelling more.

“What we saw last year was more people from the UK travelling abroad, but the counter side to that is more people coming back to Scotland.”

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Western Ferries’ results were delivered against the backdrop of another challenging year for the Clyde and Hebrides network on the west coast of Scotland, as services came under pressure from weather-related cancellations and factors arising from the age of certain vessels.

Earlier this year, the MV Alfred, a catamaran, was chartered from Pentland Ferries to provide cover on the busy Ardrossan to Brodick route.

Mr Ross has made no secret in the past of Western Ferries’ ambition to move into new routes and reiterated those hopes as the firm’s new accounts were filed.

His comments came after the Scottish Government declared in November that its preferred option would be to directly award Caledonian MacBrayne (CalMac) the contract for running the lifeline services on the west coast when the current deal expires in September 2024.

Mr Ross said: “We have a working business model that is appreciated by our customers and our communities. We provide frequency, resilience, reliability at no cost to the taxpayer. It is a constant frustration that we can’t take that business model on to other routes and to other communities where the current level of service is restricting demand.

“We continue to look for other opportunities with a degree of enthusiasm and passion.”

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Western has previously expressed its interest in establishing a freight-only service between Islay and the Scottish mainland, given the increasing demands of the island’s burgeoning Scotch whisky industry and its growing popularity as a tourist destination.

Two new passenger ferries have been ordered by Caledonian Maritime Assets Limited (CMAL), which owns the ferries, ports, harbours and infrastructure on the west coast, for CalMac to run on the Islay route.

Mr Ross also addressed the subject of capital expenditure at Western, which was effectively paused by the company when the pandemic struck in March 2020. In the years prior it had invested in new berthing structures and four linkspans on either side of its Gourock to Dunoon route, two in both Hunter’s Quay and McInroy’s Point.

The two oldest vessels in the four-strong Western fleet, which typically operates the short crossing every 20 minutes, were built in 2001 and 2003. Mr Ross said: “If we are looking at new vessels, they will be a very similar design and will be designed to fit the existing shoreside infrastructure.”

Asked if the company would consider awarding a contract to build new vessels for Western to Ferguson Marine, the state-owned Port Glasgow shipyard embroiled in a controversial project to deliver two new vessels for the Clyde and Hebrides network, Mr Ross said: “If we were looking at new vessels, the tender would be open to any shipyard looking to build new vessels. One would hope that Ferguson's may express an interest.”

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Mr Ross added: “We would be looking to place the order with a shipyard that would offer the best value for money.”

Ferguson built two of Western’s four ferries, in 2001 and 2003, and both have operated well in the period since. The yard also built four linkspans for the company, Mr Ross noted.

The two most recent additions to the Western fleet, which joined in 2013, were built by Cammell Laird.

Western Ferries announced in October that Lord Robertson of Port Ellen, the former Labour Party MP, UK defence secretary, and secretary general of NATO, would be stepping down as chairman at the end of the year, following a four-year stint. He has been on the board at Western since 2006.

Lord Robertson will be succeeded by James Denham, son of John Denham who had been one of the company's founders and directors.

Western’s new accounts show that it employed an average of 70 people during the period, up from 69.