Veolia Transport Auckland, which runs the city’s urban passenger trains, almost doubled its annual profit last year after it changed the way it does business.

Veolia, a unit of Paris-based Veolia Transdev, posted a profit of $NZ1.99 million in the year ended December 31, up from $NZ999,000 a year earlier, according to accounts filed with the Companies Office.

The company’s gross profit margin jumped to 10.7 per cent from 7.7 per cent a year earlier.

Veolia provides the rail service under a contract with Auckland Transport, which receives subsidies from the New Zealand Transport Agency and Auckland Council.

In 2012, Veolia negotiated a contract extension with Auckland Transport with incentives for performance.

“We restructured the business and redeployed our workforce, achieving some great operational cost efficiencies with no redundancies in the process,” Veolia managing director Terry Scott said.

“Cost savings achieved in the 2012 year will be accounted for in the next year’s budget and so will be passed on to ratepayers.”

Veolia’s revenue rose 7.9 per cent to $NZ92.5 million, while costs advanced 4.4 per cent to $NZ82.6 million.

The New Zealand unit paid its Australian parent a $NZ785,000 management fee, down 1.9 per cent from the year earlier.

Veolia’s trains use infrastructure owned and managed by state-owned KiwiRail.